from start to finish Adapting in order to grow
Jeff Winn, Winn Solicitors
The insurtech company How evidential video is you haven’t heard of transforming claims David Ovenden, Willis Towers Watson
John Ridd, eviid
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15/16 16/17 REVENUE
Editorial Contributors Brionie Clegg Head of Business Development MedReport
Paul Tasker Managing Director REG UK
David Williams Technical Director AXA Insurance (UK)
Paul Taylor Managing Director, Operations Plantec Assist
Donna Scully Director Carpenters Group
Rachel Culyer Regional Operational Case Manager Unite Professionals Ltd
Harvey Stead Managing Director FMG
Richard Taylor Sales and UK Business Director GT Motive
Jason Tripp Managing Director Coplus
Rob Cooper Co-Founder and Executive Director ME Group Holdings
Joe Priestley UK Public Affairs Executive Zurich Insurance Group
Robin Challand Claims Director Ageas
Nik Ellis Managing Director Laird Assessors
Rupert Armitage Managing Director Auto Windscreens
Marc Lafferty Chief Revenue Officer EDAM Group
Stephen Marshall ACII Managing Director Insure Apps
Martin Ball Head of Engineering Inspection Allianz Insurance
Steve Thompson Director Industry Insights
Michael Lewis CEO Claim Technology Ltd
Trevor Lloyd-Jones Senior Marketing Manager, Insurance LexisNexis Risk Solutions
Pablo Liñares Director of Consulting and Innovation Services GT Motive
WELCOME or the insurance industry, staying ahead of the technology curve in a highly competitive and dynamic environment is critical to business survival and success. As digitalisation continues to expand and evolve, the industry is required to adopt new technology solutions in order to keep up with the pace set by insurance disruptors and start-ups. It is becoming critical that businesses streamline their processes and operations, while still keeping the customer at the heart of it all.
Connecting with customers through digital channels is becoming increasingly more important for the insurer in order to become a true digital enterprise that suits every customers’ wants and needs. The customer is wanting to reach out to insurance providers through multiple platforms, whenever they need to, and expecting a seamless interaction regardless of their choice of channel. The customer wants their devices to all be connected as we move into the age of the smart home. So, how can insurance businesses step up to the mark and deliver these requests? Throughout this issue we come across various technologies that are doing just that. We look at Artificial Intelligence, blockchain, IoT, and the big one, data! As Jen Shorten, MarkLogic, said during her interview, “A critical part of this step is digital transformation and solving the data integration challenge. It’s only the companies that have successfully navigated these two milestones who will be able to harness all that new technology had to offer.” The more the industry looks to exploit emerging technologies, the more they will be able to transform their business models and re-engineer workflows involved in the claims process, improve data quality and increase transparency. Jeff Winn, Winn Solicitors, spoke to Modern Insurance about how they are adapting in order to continue to grow. Our conversation about the justice reforms suggested necessary changes within Jeff’s business and how technology will be helping him to redefine his business and make it more efficient once the reforms are implemented. We also met David Ovenden while attending the Internet of Insurance conference earlier in September. He suggested to us that Willis Towers Watson is the biggest insurtech company you haven’t heard of, so we challenged him to an interview in order to find out all the details! We have features covering data, how technology is being used when investigating incidents, the escape of water and, of course, our experts on the editorial board panel! I hope this issue gives you some new ideas about what you can introduce to your business in order to create a more streamlined approach. I hope you enjoy this issue, and if you have any comments or feedback, then please do get in touch via the details below.
Issue 34 ISSN 2515-3803 Co-Editor Poppy Green Project Manager & Events Sales Rachael Pearson
Modern Insurance Magazine is published by Charlton Grant Ltd ©2018
All material is copyrighted both written and illustrated. Reproduction in part or whole is strictly forbidden without the written permission of the publisher. All images and information is collated from extensive research and along with advertisements is published in good faith. Although the author and publisher have made every effort to ensure that the information in this publication was correct at press time, the author and publisher do not assume and hereby disclaim any liability to any party for any loss, damage, or disruption caused by errors or omissions, whether such errors or omissions result from negligence, accident, or any other cause.
Poppy Green, Co-Editor, Modern Insurance Magazine. @Modern_Poppy email@example.com 01765 600909
Modern Insurance 03
Issue 34 | ISSN 2515-3803
07 10 14 35
Innovation in Information Get the essential insights you need to
more accurately price and underwrite risk from LexisNexis Risk Solutions.
Combining cutting-edge technology, unique data and advanced analytics, LexisNexis Risk Solutions provides products and services that address evolving client needs, while
04 Modern Insurance upholding the highest standards of security and privacy.
NEWS 07 Stephen Marshall talks news
Disruption is on the horizon as Stephen Marshall, Managing Director, talks tech and what the future looks like for the industry.
INTERVIEWS 10 Adapting in order to grow: Jeff Winn
Modern Insurance spoke to Jeff Winn, Managing Director, about the evolution of Winn Solicitors and how they will continue to adapt as customer expectations and new technologies begin to change the landscape for insurance.
14 The insurtech company you haven’t heard of: David Ovenden
Modern Insurance spoke to David Ovenden, Global Director, about the digitisation of the entire insurance process and what this means for the industry and for the customer.
EdiTorial Board 19 The silo problem
David Williams, AXA Insurance (UK)
27 Reflecting on the likely impact of the Civil Liability Bill on customer claims
Pablo Liñares, GT Motive
21 Is it of value to the whole chain?
Paul Taylor, Plantec Assist
23 Capturing value
Rob Cooper, ME Group
25 The changing landscape of engineering
Martin Ball, Allianz Insurance
25 Streamlining the claims process
Jason Tripp, Coplus
Trevor Lloyd-Jones, LexisNexis Risk Solutions
31 What does the data tell us?
Steve Thompson, Industry Insights.
31 A new approach to business models
Michael Lewis, Claim Technology Ltd
33 The personal touch
On the 4th September, Modern Insurance attended the 3rd Annual Internet of Insurance conference. The Internet of Insurance is a leading forum for exploring how IoT and emerging technologies are enabling the insurance industry to streamline processes, manage risk and ultimately improve the customer experience. We will cover a combination of expert insights, panel discussions and case studies presented throughout the day, all emphasising the need for a better understanding of emerging technologies within the industry.
50 Transforming data
Marc Lafferty, EDAM Group
33 Communication key to public education
Rupert Armitage, Auto Windscreens
Modern Insurance spoke to Jen Shorten, Data Transformation Principal at MarkLogic, about how technology is driving change within the industry, and how insurance companies need to be effectively harnessing customer data in order to remain competitive.
35 Are we missing the benefits of the human touch?
52 Incident investigation
35 Can insurers and rehab providers collaborate to reduce the cost and lifecycle of a personal injury claim?
55 The number one priority
Robin Challand, Ageas
Brionie Clegg, Medreport
FEATURES 37 Sector Soapbox
Modern Insurance’s panel of resident associations outline the burning issues facing the claims sector.
40 How evidential video is transforming claims
Rachel Culyer, Unite Professionals Ltd
23 The value of insurance
Paul Tasker, REG UK.
29 Utilising data better
Stephen Marshall ACII, Insure Apps
21 Impact of changes/challenges within the NHS on client needs and the expectations of their case managers
Joe Priestley, Zurich
29 Being smarter with data
19 The essential tool for improving efficiencies
47 The Internet of Insurance Conference 2018
Modern Insurance spoke to Guru Grewal, Head ofEurope, about new technologies and solutions that are powering insurance businesses into the future and what opportunities Mphasis are therefore creating for the industry.
Property insurers are leaking money on escalating escape of water claims. Ian Salkeld, Head of Escape of Water, Crawford & Company, examines the reasons why claim costs and complexity are on the rise, and suggests ways in which the insurance industry can wrest back control.
59 Attracting and supporting a new generation
John Ridd, CEO, discusses how the introduction of video technology is improving business processes and the customer claims experience.
42 Industry Innovators Interview: Mphasis
Modern Insurance gathered together a range of experts to other their insights when examining the intricacies of an incident.
Bob Linwood, CEO, discusses the underinvestment of young people in the vehicle repair industry and how why the whole industry needs to engage with each other in order to solve the shortage of skills in the sector.
60 Case Study: FMG 61 Case Study: Unite Professionals
10 MINUTES WITH 62 10 minutes with…
Harvey Stead, FMG
27 The data revolution
Donna Scully, Carpenters Group
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right people. right skills. right technology.
END-TO- E N D CO M P L E T E C L AI M S & L E G AL SO L U T I O N
Stephen Marshall TALKS NEWS Disruption is on the horizon as Stephen Marshall, Managing Director, talks tech and what the future looks like for the industry. he insurance industry is ripe for disruption, through emerging technologies”. The only exception I might take to this statement is the word ‘emerging’. The insurance industry has been slow in many areas to adopt new technology, so I’d argue that it’s ripe for disruption through both traditional and emerging technologies! We often learn from history and it’s worth looking back at a couple of technology based examples:
Direct Line – hugely disruptive, used data from existing insurers, modern technology, win for the insurer and win for the customer. Customers drove disruption, targeted selection of customers created profitability, which was invested back into the direct model. This created rapid growth and the direct personal lines market accelerated as others followed. Commercial Lines Electronic Trading – slow to take hold. Stakeholders pulling in different directions. The needs of insurance brokers were different to those of insurers who didn’t want to commoditise the market. People dragged their feet; honest conversations weren’t happening. The end customer wanted broker advice; markets weren’t homogenous enough to make direct trading fly. Even now, thirty years into this discussion, we still have better rates on insurer’s own systems than on consolidating platforms. The needs of customer, broker and insurer aren’t aligned.
Don’t digitise your mediocrity, all that will happen is that the customer will find out that you are mediocre that bit quicker!
So what conclusions can we draw from looking back? Primarily, that we need win, win, win conversations in the intermediated market. The environment needs to be right for disrupters to capitalise.
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It’s all well and good looking back and stating what needs to be in place to foster the right disruptive environment, but what about the future? The modern broker will become more and more customer led, not just in words but in actions and culture. Customers are all different; some people want the personal touch, some want to log on to a portal and find out for themselves. Some are entrepreneurial risk takers just looking for catastrophe cover, others want risk management led programmes to stop problems occurring. Some want cheap, others want value. However, we all want it to be easy, to trust the people we are dealing with and for it to work first time – we want it to be proactive and make sense to us. The customer is attracted to the broker that shares their values, sometimes their interests, but ultimately those that will deliver what they want, when they want it and in a form that they understand. Use technology in a smart way and you can meet these differentiated needs – let’s take a look at some other examples of what’s happening: Artificial Intelligence – machines don’t get bored, they’ll keep doing the same things, which means less operational errors. They can sift through masses more data than a human and spot trends and patterns that could be missed. The underwriting benefits and fraud detection abilities speak for themselves. I remember a rather ‘whacky’ senior manager in the 90s who had called me up to talk to him. I’d downloaded a whole load of data into a pivot table and found that pubs that had the word ‘river’ or ‘bank’ in their name were a poorer flood risk than the average, not exactly rocket science I hear you shout! However, he was excited about this and talked about insurance underwriting as a swimming pool of data which machines would trawl through, learn and look for patterns. We now have this technology and we find ourselves with oceans of data as opposed to swimming pools of data. He was ahead of his time and not really ‘whacky’ as it turns out.
to exchange, often between independent parties. The security assurance that Blockchain brings will help with operational efficiency, removal of fraudulent claims and the creation of new services. Our Claims App business at present can report claims to policyholders, brokers and insurers at the click of a submit button – the broker chooses how this works. In the future, I can see a broker choosing to push the data straight into an insurer’s database, to a recovery firm, to a repairer, to a vehicle parts supply company. The question will be not is it possible but how far do you go? Could a vehicle automatically assess its level of damage and start the recovery and repair process without human intervention? To do this you will need the security that Blockchain brings. The insurance landscape has changed and will change further. Customers expect there to be ‘an app to do that’ – do an experiment, speak to your next five clients about what apps they have on their phone. I’ll be surprised if you are not surprised at the variety of apps that people use. You’ll also find that they have dozens of apps on their phones that they don’t use and even some that don’t work anymore! Get to know how your clients operate digitally, e.g. what technology is the farmer using these days? Soil and water sensors; agbots; tractors that can auto-plough; cloud seeding to make it rain (not something we need here in Scotland!) are just some of the things that are transforming the agriculture sector. Insurance touches all business sectors, what can we learn, and what do our customers expect of us? Technology is great but make sure it’s win, win, win and that the investment makes sense. As our customers change the way they use technology then how should the brokers respond? What should the future Account Exec, Account Handler or Claims Handler look like in terms of skills? What new risks are we creating as different industries digitise at a frightening rate? Are we keeping pace? Don’t digitise your mediocrity, all that will happen is that the customer will find out that you are mediocre that bit quicker! Stephen Marshall is the Managing Director of Insure Apps.
Blockchain – or as I sometimes think of it ‘The Field of Dreams’. “Build it and they will come”, the often adapted line from the film is where I think we are with Blockchain. If you don’t understand what it is then keep reading about it, it takes a while for it to sink in. It’s important because our industry has masses of data
08 Modern Insurance
Adapting in order to grow Interview with
Modern Insurance spoke to Jeff Winn, Managing Director, about the evolution of Winn Solicitors and how they will continue to adapt as customer expectations and new technologies begin to change the landscape for insurance.
Since its formation in 2002, how has Winn Solicitors evolved and changed over the years?
It has grown very rapidly. Over the years it has been about adding on to what was the primary one-stop shop for road traffic accident victims. Initially we were looking at personal injury and getting a hire car but we have gradually extended the business to cover more elements, such as the medical side, treatments and provision of experts etc. We started off advertising just in the North East but now three quarters of our business is national and that has primarily been built-up through our insurance broker networks. We developed from just offering the service directly to the public to going via insurance brokers and persuading them of the benefits of having all of their claims reported to us – if it was their fault then we pass them onto the insurer, if it wasn’t their fault, we bypass their insurer and claim against a third party. That has been a big development and the fastest development of the business has been the broker side. It is a win-win for everyone as a lot of the brokers get an additional commission from the insurer if they have got a good claims record.
What were the reasons behind you creating a one-stop shop outlet?
It largely started before 2002 as I had an accident that wasn’t my fault. I reported it to my insurer but I didn’t realise and they didn’t tell me that they settled it knock-for-knock, which even though someone had run into the back of me and it wasn’t my fault, put my insurance premiums up. When the repair was done I was told that it had been done with non-manufactures panels and parts, which put my warranty at risk plus the value of the car was reduced as a result of the accident, so I was far worse off then I should be given that it wasn’t my fault. I made some enquiries and found that quite a lot of solicitors, particularly in the North West, were offering a service whereby they were avoiding their own insurer and going directly against the other side’s insurer - the whole process was messy. I thought why
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There are a few technological changes coming and there will be a move towards artificial intelligence (AI). AI will make this area of work leaner and more efficient and we are most definitely wanting to get ahead of that curve Issue 34
We are working much more with the technological changes that clients are experiencing and the use of mobile phones and their connectivity are at the core of that
not pull it all together with a one-stop shop service whereby one assessment is done at the start â€“ it is either a goer and looks like a non-fault, or it is not - then that assessment binds everyone in the chain and we provide the hire and the legal etc. That made it much faster and it proved very popular when we went to market.
What strategy do you have in place to ensure that Winn Solicitors continues to grow and develop in the years to come?
With a lot of the changes to the personal injury market we will start to see a lot of solicitors dropping away, so we have refocused our business more on the hire and medical sides rather than the legal side, so now 90% of our profit figure comes from those other sides of the business. We have reduced the targeting of personal injury and target more on the hire, repairs, full accident management servicing and add-on services. We are looking at a potential stock market listing to raise some more funds to really build the business and help to prosper early next year.
Technology is changing the industryâ€™s landscape, so what new technologies can we expect to see?
We are certainly at the forefront when it comes to new technologies. We use the Proclaim system. If you spoke to them youâ€™ll probably find that we are their most demanding client because we want to do more and more with it. We already have secure docs so nearly all of our documentation flow comes through the secure doc site so it saves having to post things out. It is also easy for clients to accept the terms and conditions and that means that the case gets progressed faster because they just go on the portal, click accept on the terms, complete the document and we have got it immediately. We are introducing a new dialler system in January. Traditionally, fee earners have made calls on set files. The dialler system will be pre-loaded with chasers and then we will have a team that will be on the phone using an automated dialler to get through to clients faster and over a longer period of hours.
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Changing the method in which we work is going to be key in adjusting to the lower fees, which are coming with the PI changes There are a few technological changes coming and there will be a move towards artificial intelligence (AI). AI will make this area of work leaner and more efficient and we are most definitely wanting to get ahead of that curve.
Jeff Winn Jeff Winn is the CEO of Winn Group. A recognised business leader in both the North East and the legal world, Jeff and his company have won numerous awards, including North East Entrepreneur of the Year (2014), Personal Injury Awards Outstanding Achievement of the Year (2016), Northern Law Awards 2015 Law Practice Management Award, and others.
How are consumer buying habits changing the way that products and services are delivered?
We are working much more with the technological changes that clients are experiencing and the use of mobile phones and their connectivity are at the core of that. We are trying to introduce more text updates and allow people to click straight through from their mobile phones onto the documents. Clients are becoming more demanding but it is all about being clear when communicating with them.
Having qualified in 1990, Jeff established Winn Solicitors in 2002. Since then, Winn Group has become a pioneer of the ‘one-stop-shop’ approach to RTA claims, and deftly adapted to legislative changes affecting the industry. Under Jeff’s management, Winn Group’s strength continues to impress.
What are the benefits of building a network of partners?
We have networks of partners on the repairer, engineering, medical and broker sides of the business. It is about gradually building more and more people into that business that you can trust to do a good job – our approach has been to keep two or three suppliers for each core area and then move around depending on how we view the SLA and their performance.
What is your outlook on the justice reform changes?
I would rather that they didn’t happen. It is unfair on the victims of road traffic accidents – the compensation that they get already in the UK is about 5% of what it is in the US, and they are putting it down to about 1% and taking away the legal fees that help clients get that sum. When it comes through, as it has been delayed a year, it is going to have an impact. However, bottom line is that there is no point in bleating about it – we have just looked to amend our system where we can give help to the client and point them in the right direction. The problem is going to be for clients where there is a dispute on liability – the question there is going to be will the courts put it into fast track based on the complexity, which has been suggested but not written into the rules, or are they just going to have to go to court and argue that out themselves. It is not easy for a client to deal with low velocity impact arguments up against an insurer’s engineer – I would like to think that on those difficult cases that they will still be putting fast track on the basis of the arguments being put forward by insurers but we are yet to see whether that happens. Our focus is on the other side of the business and building volume to fill the gap. We think it will take us 12-18 months to replace our personal injury work with more of the other work that we do.
How do you keep the customer and their journey at the forefront of your firm?
We have a process here where we draw out the full process on some wallpaper and stretch it across the board room and go through it. It is amazing how many times when I ask for it to be updated with a current process, someone has added something that just isn’t necessary or justified by the cost, time or delay and so we regularly have a look at the customer journey and decide how we can sharpen it up and get it working better.
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One of the classics for us, for a long time, clients always think that they want one person to deal with their file but we have just been trialling working in a different way where we split the case into stages and a number of people work on the file - we think this will knock off 90 days of the average progression of a case. Changing the method in which we work is going to be key in adjusting to the lower fees, which are coming with the PI changes.
How has the industry changed since you started working in it?
The margins have been cut massively. When I think back ten to fifteen years ago, we were getting an average of £2,500-3,000 in fees for a personal injury and now the average is £1,100, so now for inflation that is a massive drop. It is one of those things that the industry has had to get very lean and efficient with to be able to cope with that reduction in fees but it has largely achieved it. The PI lawyers are well ahead of the field in terms of how to automate. What will be interesting is when those PI firms’ personal injury cases dry up, do they move it to other areas of law to try and bring those efficiencies into areas such as conveyancing and probate.
What challenges and opportunities do you foresee for Winn Solicitors in the next five years?
Government interference. It is always difficult to know what changes might come and that can create some uncertainty in the industry. To a degree, competition, but we are in a low cost base in the North of England where a lot of our costs are below our competitors. I do think the market is going to consolidate into relatively few big players who like us are a one-stop shop.
Jeff Winn is Managing Director at Winn Solicitors.
The insurtech company you haven’t heard of Interview with
Modern Insurance spoke to David Ovenden, Global Director, about the digitisation of the entire insurance process and what this means for the industry and for the customer.
You stated that Willis Towers Watson is the ‘biggest insurtech company you haven’t heard of’, could you delve more into this?
The legacy actuarial consulting element of what is now Willis Towers Watson, was born of partnerships merging and those partnerships brought different specialist software solutions together. Typically, those solutions were originally to help actuaries execute some element of specialist insurance mathematics. As the organisation came together, all of that software became part of the Insurance Consulting and Technology division and as those individual specialisms developed they have often moved into the enterprise world. So if you take the technology I am responsible for, the pricing, claims and underwriting suite, we originally enabled actuaries to develop and deploy better pricing, and now we have moved into the world of business management using the core pricing data assets to help insurers understand their pricing, performance and product mix better, then test and deploy pricing to the market at pace.
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Big data begins at home. So, what does that mean for an insurer? It means that you need to make sure that you have a data strategy, and a culture that values data as an asset
I often think of new technology in two dimensions – one is insurtech that enables you to distribute product and then insurtech that enables you to make better decisions
In recent years, we have moved into price execution, supporting the majority of the UK personal motor market in executing sophisticated pricing into the market. Our technology allows companies to, in real time, calculate individualised pricing across hundreds of variables and push that price out to a website, an aggregator or a device, delivering it to where it needs to be. We run the algorithms very rapidly, and then deploy that price wherever the insurer needs it to go. That capability is real insurtech, it is also what people need to be able to do in order to engage with some of the insurtech distribution out there. The emerging ‘slice’ type products, where the customer has the ability to change what and when they insure their assets, requires the digitisation of the entire insurance process including pricing and underwriting rules. When I say we’re the biggest insurtech company you’ve never heard of, that is one of the many stories behind the technology component of Willis Towers Watson.
What will intelligent automation look like within the insurer/ broker markets and what opportunities does this present for the industry?
If you look at the commercial insurance IT infrastructure, there is a lot of legacy infrastructure. We have characterised an arms race around data and analytics in personal lines and as a result the technology has had to adapt and keep up with that – this analytics arms race is now spilling into the commercial lines markets. In our seminar we have been talking about bolting specialist capabilities onto legacy platforms but in a connected, strategic fashion. You could bolt on, for example, our real time pricing and decision engine, Radar Live, a data warehouse, plus some workflow capability connected to the legacy platform via an integration layer. You would now have a new integrated underwriting workbench and portfolio management platform. What that allows you to do is use your old legacy platforms as a vehicle to do your billing and your statutory reporting. The legacy
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We have characterised an arms race around data and analytics in personal lines and as a result the technology has had to adapt and keep up with that – this analytics arms race is now spilling into the commercial lines markets application is great but they don’t serve the outside community very well. The processes required to operate the screen workflow doesn’t work in the modern world, it doesn’t facilitate the input of data by brokers or the user mobile resources. This concept of connected specialisms, where best of bread solutions are integrated, allows for the deployment of intelligent automation. Where a traditional workflow approach is significantly enhanced with the real time deployment of predictive analytics for scoring, routing and evaluation. Insurers have an ambition to automate more business and be more effective where underwriters are deployed. As a result, an insurer’s wiliness and ability to automate becomes critical, that ability is enhanced as more granular data and analysis becomes available. An insurer’s ability to frame, model and deploy a granular automated footprint is becoming a key factor in operating at pace within the less complex end of the commercial market.
You referenced an analytical ‘arms race’, how is competition changing in the insurance market?
Twenty years ago we built our first software, Emblem, which allowed people to easily create Generalised Linear Models (GLMS) without coding knowledge. Now there are a range of machine learning and unsupervised model forms through open source technology, and once again they require coding. The challenge we are taking on is allowing insurers to build, govern and deploy these new model forms without the extensive use of coding. However, the key remains in asking the technology smart and insightful questions, if you take an unsupervised learning algorithm, throw it at a dataset and let it do its thing, it is going to tell you a load of things you already know. The interest comes when you ask this technology the right question and understand the impact of the answer and then deploy at pace. Whilst this is now common in personal lines the same concepts can be applied to commercial. There is a need to understand your portfolio at a very granular level, and then drive or respond to changes in the market, deploy the approach at pace and then monitor and feed the new insight that back into the loop.
How is the Radar software harnessing technology to improve commercial lines’ pricing and underwriting?
Insurers want to do the model pricing and underwriting rules, understand the impact of options and then rapidly deploy the new rules and pricing. In our world that is Emblem for modelling, Radar for impact analysis and Radar Live for deployment. In commercial lines, data is typically scarce, so insurers may start in the Radar world by getting a deeper understanding of their portfolio. Radar will take all your transactional exposure and claims data, whether it is joined or not, and then we can quickly engineer it to allow role-based visualisation all of that data. For example, within Radar it is possible to develop and review
16 Modern Insurance
automated footprint models and then look at the impact across many dimensions. In the past, insurers used size of exposure or premium as a proxy for complexity, we allow a much more granular approach allowing a much broader, yet no less understood automated footprints.
How could the sharing of data improve relationships within the insurance sector?
There are a couple of dimensions to this – there’s a ‘who owns the data and privacy’ dimension. At the moment there is very little way that anyone can control their data asset at any level beyond privacy settings in an app. I suspect that there will be a market in data that is more permission based and much more granular. Where will clients benefit? There will undoubtedly be sectors where the insurance industry and other sectors can help clients together. One that I personally think is an interesting area on the commercial data side will be mid-market commercial telematics. Mid-sized fleets, where there is no professional fleet manager, will benefit from tailored real time insight. If you think about telematics for personal lines, it has gravitated to younger drivers. I think you will see this type of segmentation in other areas of IoT in the personal lines world as well. It is not just in the insurer’s interest to stop a pipe bursting, it is actually in the client’s interest. IoT and/ or the use of data is a way of bringing data to the client, targeting those scenarios and finding a way that the industry can help.
What emerging technology would you advise insurers are essential to their digital transformation?
Big data begins at home. So, what does that mean for an insurer? It means that you need to make sure that you have a data strategy, and a culture that values data as an asset. If you don’t value data enough and you don’t treat it well enough, or it doesn’t feature in your recognition and reward, then actually you’re not going to be well enough equipped for the future. Your data culture is going to be vital for your infrastructure. You have got to be able to deploy data as an insight to anyone in your company that is making a decision. Another key element is the integrated system. So your key platforms for your key processes need to have a data integration. That integrated platform allows the infrastructure to do things like intelligent automation and the ability to ask less questions. It means you can then bolt on the new technology as it arrives. If you have got a good foundation and environment, it means you can bolt on the new technology. I often think of new technology in two dimensions – one is insurtech that enables you to distribute product and then insurtech that enables you to make better decisions.
Insurers may have good analytics and/or workflow tools, often coming across from other sectors, but they are not yet combined and integrated into tailored insurance specific environments
What technology trends do you foresee in the next year?
The concept of underwriting or a claims workbench. Insurers may have good analytics and/or workflow tools, often coming across from other sectors, but they are not yet combined and integrated into tailored insurance specific environments where real time analytics and intelligent automation are seamlessly integrated. Bringing structured and unstructured data together in order to make better decisions. There are a lot of interesting areas that open up as the huge volumes of unstructured data becomes more accessible. The insight in unstructured reports, notes and transcripts are going to add to the richness of automation, pricing and operational decision support.
Q A David Ovenden BA, ACII, Global Director, Pricing, Products, Claims and Underwriting, Willis Towers Watson, Insurance Consulting & Technology David has a blend of technical and general management experience developed in the UK and international GI markets. Over the last 25 years he has held as mix of both strategic and operational leadership roles. David Currently leads WTW’s Pricing, Products, Claims and Underwriting Practices across both software and consulting. Working closely with the Actuarial and Software teams across Life and P&C, David’s experience includes: • Transforming business performance • Deploying best practice underwriting, pricing, claims and portfolio management • Extending the lifespan and functional capabilities of legacy IT platforms to facilitate digital transactions • Data driven decisions - Improving management information, and the use of external data to support portfolio and case underwriting decisions
What are Willis Towers Watson’s plans in regards to new emerging technology?
Two big areas of investment for us are automated machine learning and the integrated workbench. Within the machine learning environment, we are ensuring Radar and Emblem continue to provide a well governed, low code environment to develop and deploy models across the insurance value chain. With Workbench we are seeking to integrate intelligent workflow and rich decision support, delivering insurers efficient and effective underwriting.
David Ovenden is the Global Director of Pricing Product Claims and Underwriting at Willis Towers Watson.
IoT and/or the use of data is a way of bringing data to the client, targeting those scenarios and finding a way that the industry can help
Modern Insurance 17
The silo problem How can relationships between different departments be better utilised to improve performance and processes? veryone knows that silos can develop within insurance companies, and often the bigger the company the more divided teams can be. What surprises me however is that the teams that you would think would more naturally fit together, are often those that seem most divided.
Claims and Underwriting are the obvious silos to break, rarely will someone from Claims move to a career in Underwriting, or vice versa, despite the fact that the technical skills that each needs are very similar. Still I hear comments from Claims people that Underwriters will “write any old rubbish”, and Underwriters think that claims people “Just Pay Anything” (that latter observation an interesting contrast to the claimant lobby who often suggest insurers will do anything to get out of paying a claim!). If you think about it, how could those two teams better understanding of each other’s roles and responsibilities be anything other than good? Underwriters particularly have to attach a premium to perceived risk, the practical experience of handling claims over a period would undoubtedly give them an insight they don’t always have, allowing them to more accurately assess what’s likely to happen and genuinely become better underwriters as a result. Similarly, Claims people spending some time in Underwriting will help them both understand policy construction and wordings better, as well as that age-old problem on contentious cases of understanding what the Underwriter intended to cover. Another benefit and possible solution to the silo problem would come from seeing more movement of staff from one team to another. As well as the points above, everyone seems to be talking about difficulty in retaining and motivating good staff, and every expert I have read of late suggests that training development and variety can have a massive impact. If you move from one team to another, as well as helping the teams benefit from a fresh pair of eyes on process and practices, you are getting development, expanding those brain cells and making you employable in even more future opportunities that might arise. Horizontal Mobility is a new expression to me, but one that looks to describe this approach, giving staff lateral opportunities that develop them will help to keep and motivate them, as well as delivering a more joined up and improved process for our end customers as well. Definitely something we are going to try and improve on.
The essential tool for improving efficiencies How can workflows be optimised in order to improve and increase productivity? orkflow solutions and Business Process Automation have been in place for a number of years and are an essential tool to improve efficiencies in processes. The incredible evolution in digital technologies and connectivity is providing a new dimension and possibilities to integrate and automate processes in ways which were unthinkable some years ago.
Core business processes have been traditionally targeted for automation by ERP (Enterprise Resource Planning) systems, automating core processes in production, finance and HHRR. Those systems extend their reach to suppliers (SCM – Supply Chain Management) and customers (CRM – Customer Relationship Management). Beyond the endless puzzling acronyms list, the body repair industry and particularly motor claims has been a traditional challenge for improving workflows and automation. In my point of view, the relevance of the moment of the claim, sensitivity towards the customer and the need to integrate very diverse ecosystems (insurer claims systems, bodyshop management systems, etc.) are the main challenges (and therefore opportunities) for workflow tools to improve and increase productivity. We do believe that standardisation and existing cloud technologies allow for online and secure information sharing, which is the foundation of any workflow automation. Phone calls, emails and even Fax(!) needs to be replaced by direct integration between systems, which talk to each other in real time and securely, sharing the pieces of information that is needed at each stage of the process. The amount of time spent in manual processes, calls chasing for status updates, etc., is enormous and what is worse is not having the right answer for our customer in their claim journey and losing the only opportunity to prove how great our service can be. In an ideal world the customer should have all the answers he/she needs and only call when human interaction is needed for complex matters or simply to provide that “human touch”. Enabling work providers, repairers and engineers working in open, online and secure platforms offers incredible opportunities to improve efficiencies and thus providing a better service to the customer, which in the end should remain at the centre and benefit from all these efficiencies.
David Williams, Technical Director, AXA. Pablo Liñares, Director of Consulting and Innovation Services, GT Motive.
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Is it of value to the whole chain? How can the traditional ways of claims and policy management be redefined in this digital age? once had a colleague that used the expression “If the only tool in your toolbox is a hammer, then every problem is a nail”. If you just take what is there and digitise it, then there’s a good chance that you’ll make some incremental improvements, but just as good a chance that you’ll miss the transformational changes.
I say there’s a good chance that you’ll make incremental improvements but if you just look at the problem from your own point of view then there’s every chance that you’ll build something that makes things worse! Let’s look at some examples in our own industry that have failed to deliver: • The insurer that says to brokers, “we’ve built a portal for you to report claims into”, so the broker needs to type the claims info into their own back office system and then instead of intimating a claim using that system the insurer wants them to add fifteen minutes by logging into a portal and retyping the info. • The broker that pushes clients to log into a system to view their policy details as it’s more efficient, when actually what the client wants is a personal service. • The insurer that builds a claims app and says to brokers you should use this as it links into our back office system, whilst the broker sits there and thinks what if I want to move that account to another insurer next year. Often these things come about because we are not having strategic conversations where the client wins, the broker wins and the insurer wins – tick benefits to all and you are on to a winner. The technology just follows on, it’s there to serve you, not the other way around. Blockchain, AI, claims paid instantly, drones, cars automatically reporting accidents, embedded software in goods – brilliant but does it benefit all the parties, don’t just do things to be in Vogue. Virtually anything is possible digitally but stand back and make sure it’s benefiting the full value chain. Honest conversations all going in the same direction and delivering value. Stephen Marshall ACII, Managing Director, Insure Apps.
Impact of changes/ challenges within the NHS on client needs and the expectations of their case managers here is a major trauma network made up of specialist trauma centre hospitals and these are responsible for the care of very severely injured patients. These include hospitals such as Southmead, St Georges, Derriford and Northern General.
The front-end care for these patients, including roadside and paramedic care has become outstanding. Patients receive fantastic imaging, are often seen by the top consultants and highly experienced rehabilitation staff. The rehabilitation is often intensive and progressive. However, they are then repatriated back to their local hospital and into the community where things change significantly. The continuing care/rehabilitation services frequently do not match that front-end care at all, there is a mis-match in care. Patients often are discharged with little physio, occupational therapy, psychological therapy, vocational rehabilitation, speech and language therapy as examples, and the lack of these services has a very negative impact on their progress and return to work and former occupational activities. It is critical that case managers are appointed at the earliest possible opportunity and are involved with the in-patient stay to ensure that the transition from the trauma centres is adequately managed and then services provided at the required intensity and in a timely manner within the local community. A good case manager who is able to think outside of the box is essential in ensuring that clients return to work as soon as possible, are able to resume domestic and personal activities as well as regain meaningful occupation. Case managers need to be excellent communicators, be willing to challenge the statutory services and coordinate private and statutory services ensuring they work positively together with the sole focus being the best outcome for the client, not defending their own corner. The front-end care can be absolutely brilliant and it is to be celebrated that so many life’s are now being saved, however it is critical that a patient is given all the available options ensuring they have a quality of life comparable to that prior to their accident rather than just being grateful that they are alive but with a very poor quality of life. Rachel Culyer, Regional Operational Case Manager, Unite Professionals Ltd.
Modern Insurance 21
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The value of insurance
e live in a world where the general public are so used to hearing about the doom stories associated with insurance, it is little wonder that mistrust continues to exist in our industry. Add to that the complex policy wordings, high costs at the point of purchase and our natural human instinct that tells us to believe “it will never happen to me” and you have the perfect recipe for confusion, lack of protection and negative feelings from customers.
What role does data play in customer service, and how do you see this evolving?
Those of us working within the industry know that insurance done well is a lifeline to millions of individuals and businesses around the globe and when the inevitable does happen, our industry is there to sort out the mess, protect valuable assets and support the economy by making sure that the wheels keep on turning. There are many current examples of good practice right now where we are taking the message to the general public with a new confidence and trying to make the messages clear and simple. My ex-colleagues at AXA have done a brilliant job of simplifying policy wordings over the last few years with their ‘Making Claims Clear’ initiative. BIBA and the CII are driving ‘Chartered Status’ through the industry also and it’s making a real difference to the quality of service and perceptions by customers. The mainstream media love a good heartbreak headline, of course, and it’s always going to be more interesting to go to print about the insurer who failed to pay a claim or the rising cost of premiums. We have to get even better at telling our own story and use the magic world of social media to connect with the general public and raise awareness about the value of insurance in the modern world. Keep it simple for the customer, connect with them between renewals to reassure them and most importantly of all, talk about the real examples where we are protecting lives and compensating losses every day, whether that be making sure the wages can still be paid after a loss, re-building a house after a fire or helping to put a life back together after an accident – what we do is amazing!! Paul Taylor, Managing Director, Plantec Assist.
ata-led businesses that manage change in real-time are far more responsive to customer behaviours, and will therefore rank higher in customer satisfaction than those firms who have little understanding of the data that underpins their business or those that fail to act on what their data is telling them. At a basic level, accurate customer data is not only a legal requirement but essential to making sure that a service can be properly delivered. At a wider business level, effective use of data can drive significant efficiency improvements and enhance the overall customer experience.
By way of example, if a firm records, with the customer’s informed consent, their contact behaviour in a format that can be readily analysed, it can begin to tailor the delivery of its services for that specific customer. If Mrs Smith only ever phones the business in order to discuss queries, does not choose to engage via webchat, and has a pattern of behaviour of phoning on a Monday morning, then the firm should have a contact strategy for Mrs Smith that is phone focused and aim to contact her on a Monday morning. There would seem little point in trying to contact Mrs Smith via email. Aggregating data of this type can then begin to inform resource planning and be used to make informed assumptions on contact strategies for new customers of a similar profile. The importance here is ensuring the data set is dynamic and the business adapts in real-time to changes in that data set using technology, without the need for an analyst to interpret the data and make manual adjustments. The optimum approach in this regard is AI and IoT managing the service delivery in real-time. Aside from the obvious technological investment, and programme of change for most firms, the biggest challenge is securing customer buy-in to data sharing. Business generally, and particularly in light of recent data security scandals, has a lot to do to convince customers that increased data sharing can improve customer experience. Historically, data has been mined largely for the purposes of direct marketing. We all need to evolve to using data to improve the customer experience and trust that a higher standard of customer service will naturally lead to improved revenues, but it is a long term strategy that requires significant investment. Rob Cooper, Co-Founder and Executive Director, ME Group.
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The changing landscape of engineering
Streamlining the claims process
erceptions of engineering are changing and rightly so. Previously, the word ‘engineer’ possibly conjured up images of men in boiler suits peering at machinery and making observations on notepads. Whilst this still exists, engineering is rapidly becoming a digitalised industry, making use of the latest technologies to undertake inspections, manage supply chains and better visualise and plan construction projects.
How can the traditional ways of claims and policy management be redefined in this digital age?
Paper notepads are increasingly being replaced by hand-held smart devices as the tool of choice for engineer surveyors. Such gadgets have a variety of benefits, from being able to capture realtime data and images of defective equipment, to providing GPS information where a lone worker may have fallen into difficulty and need rescuing.
The insurance world, as we know, is not so quick to change. The complexity of the service we provide and the need for confidentiality and protection of customer information are factors that contribute to a slower adoption of new ideas in claims and policy management.
Drones are recognised for being able to assist in both safety inspections and building projects; their particular advantage being that they can check high or impassable structures such as tower cranes, skyscrapers and wind turbines, which would be difficult and costly for humans to navigate. Their cameras can capture photographs with a higher degree of accuracy than traditional aerial photographs and transmit images to computers, to determine a site’s suitability for building upon or for creating 3D models. The future may see drones transporting parts and equipment, helping to reduce delivery lead times. The potential use of Blockchain in the engineering industry is only just starting to be explored. Blockchain’s primary advantage is that it allows individuals, who may not know each other, to create a decentralised auditable, incorruptible record of transactions. This lends itself well to collaborative processes, such as construction projects. Construction engineers may start to use Blockchain for conducting and recording economic transactions, or for the exchange of smart contracts. By virtue of its transparency, Blockchain can be put to good use for managing supply chains between different parties. Engineering is also becoming ‘greener’. With renewable energy targets set by the UK government, many see solar power installations, hydro plants and wind farms as offering the perfect solution for alternative sustainable energy. Engineers are fundamental to both the construction and on-going maintenance of such installations and technology is developing quickly in this area. Engineering has been a firmly established industry for hundreds of years but is currently undergoing a period of huge change. Since engineering touches each of our lives every day, it needs to continue to evolve in step with an increasingly digital world, delivering and ensuring the on-going safety of tomorrow’s projects.
or both consumers and business customers, the way we access customer service assistance has expanded extensively from online chat to social media platforms and apps on our phones, watches and televisions.
At Coplus, we manage claims for over 2.5 million policyholders, so understanding the needs of our customers at this critical time is extremely important to us. For many people, speaking to a claims handler is still imperative, especially so at the start of making a claim. Take Motor FNOL, for example, often the person claiming is uncertain of what the process will be, what information they need to provide and what to do about practical concerns like not having a vehicle to drive. Because their needs are very specific to their own circumstances, talking it through with an experienced person gives immediate reassurance that what they need is being taken care of. In Motor FNOL, the revolution of technology is more evident ‘behind the scenes’ in the system we use to manage the claim. New technology has enabled us to bespoke the claims process and ensure every variable relating to the customer, their circumstances and the service is captured and controlled. The intelligent decision based work flow ensures that the correct services are easy to deploy regardless of the number of parties involved or any other situation. Additionally, integrations between systems also drive efficiency and make sure the customer is reassured by the end of the FNOL call that the services they need are on track. Of course if a claim is less complicated then customers often opt for ‘online only’. In a gadget claim, the loss of a phone is straightforward to report online and once the detail is captured the customer just wants to know how quickly their phone will be replaced. In either case, for complex and straightforward claims, there are significant improvements to the customer claims journey in new technology, both in the back office and in ongoing communications to resolve the claim. Jason Tripp, Managing Director, Coplus.
Martin Ball, Head of Engineering Inspection, Allianz Insurance.
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The data revolution Could the sharing of data, information and knowledge be better utilised by insurance industry stakeholders to aid in the fight against fraud?
Reflecting on the likely impact of the Civil Liability Bill on customer claims
o-one doubts that how data is managed will be at the centre of fraud prevention in the future. Insurers have always collected enormous amounts of data, but have never been better able to exploit what they have at their disposal. We are all likely to become better acquainted with benchmarking, machine learning, detection at point of sale and the use of data lakes to capture all data rather than defined and categorised data fields. Over time, it is inevitable that data sharing will increase through various systems, portals and organisations, overcoming resistance from pockets arguing commercial confidentiality. GDPR may make things a little more problematic but it does not look as if it will be the roadblock that many feared. Together, this data revolution will have a massive and positive impact upon fraud prevention and detection.
ollowing the Civil Liability Bill’s Second Reading in the House of Commons, we were able to get a better sense of the arguments and debate that will dominate the remaining legislative hurdles the Bill has to pass before it receives Royal Assent.
Consumer trust will, however, be a growing issue. Consumers are increasingly understanding that their data is a valuable commodity and are likely to guard it more closely in the future. The insurance and wider claims sector must recognise that consumer trust is paramount, that consumers must trust the sector to store and use their data responsibly, otherwise levels of consent are likely to fall.
It is clear that our current compensation system is failing. This is not a myth. It is failing too many genuine and honest claimants who have a right to access fair, proper, and timely compensation. People believe they can exploit the system with exaggerated and fraudulent claims, seeing it as a “victimless crime” as it is the insurer who pays. Ultimately, the price is paid by millions of honest customers through higher insurance premiums and rising prices as well as increased costs to local authorities and the NHS.
There are some areas where practical action is needed. We need to consider reducing the limitation period in motor claims to stop the practice of data mining. For too long now, we have allowed valuable personal data to be quietly bought and sold by marketing and survey companies, garages, car hire firms, price comparison sites and even insurers. This dubious practice must be addressed if consumer confidence is to be retained. Identifying the source of the referral on the CNF, in a meaningful way rather than ‘Googled’, will enable insurers to more accurately target fraud, hopefully protecting the overwhelming majority of claimants who are genuine from having their claim blighted by association with known suspect ‘introducers’. It would assist with the spotting of trends and new areas of concern that insurers and claimants could work together to investigate and eradicate. Finally, collaboration needs to improve between the different sides of the sector. Truly joined-up and effective action on fraud can only be achieved if the sector breaks down traditional barriers and works together better on sharing fraud. Once out of the current storm, that must include the legal sector. Donna Scully, Director, Carpenters Group.
As expected, the debate was split down party lines with the Bill meeting strong opposition from the Labour Party who pledged to vote against the Bill on Third Reading if significant changes are not made. They framed their attacks around access to justice and scepticism about insurers passing on savings to consumers – this is despite insurers publically pledging to pass on cost benefits to consumers. Most surprising were comments from Labour MPs who suggested that there is no compensation culture in this country and it is, in fact, a “myth” and a “bogeyman” designed to gather public support to justify the whiplash reform measures.
We see so many examples that demonstrate how unscrupulous people and claimant lawyers with vested interests are exploiting the current system. We recently had one case where a Zurich customer reported that they were involved in an accident, advising our investigators that they had accidentally pressed the accelerator instead of the brake, losing control of their vehicle and colliding with a fence. The customer advised us that there were three other occupants in the vehicle who all submitted claims for whiplash injuries against Zurich. However, two independent witnesses to the incident contacted us to advise that only the driver was in the vehicle. The claims submitted were deemed to be manufactured and, therefore, fraudulent. Despite bringing our concerns to the attention of the Claimant Solicitors, Court proceedings were issued for one of the claimants, which we instructed our solicitors to defend. Further to the two independent witnesses’ evidence, the litigated claimant filed a Notice of Discontinuance shortly after. We issued contempt proceedings against the parties involved. Further intelligence searches undertaken revealed that the claimants had links to other accidents in which there were suspicions of fraud. The Civil Liability Bill is, therefore, essential to repair our broken personal injury compensation system and ensure honest customers benefit from a fairer system. Joe Priestley, UK Public Affairs Executive, Zurich.
Modern Insurance 27
Being smarter with data
Utilising data better
What role does data play in customer service? How do you see it evolving?
How can the insurance industry further utilise technologies that customers already possess, in order to streamline processes and enhance the customer journey?
think we can start by making the comment that traditionally, data wasnâ€™t utilised by firms in the financial services sector in the most effective manner to enhance or increase the effectivity of their customer services efforts. Since the advancement of the internet age, firms have been aggregating more and more data about their customers. Data very often sits within multiple silos all using different tools to manipulate or store the data.
The holding and processing of data is highly regulated and regulatory requirements insists that there must be legitimate reasons to hold and process customer data. As a result, businesses are having to decide: do we want to keep this data? If we are going to keep this data, why are we keeping it? Firms must now put the data to use rather than stockpiling it. We are not saying that using data has been driven by regulation, but ultimately, regulation supports the concept that data should be used, but for legitimate purposes and in the right manner. So that is making businesses think, how you can demonstrate that the data is being used legitimately. Which means businesses need to be more intelligent with their data. Within a customer services environment there are two key areas in which data is having a discernible impact. The first is better understanding of your customersâ€™ wants and needs. This is important because it enables you to tailor your products and services accordingly. Data can be employed to identify interesting segments and target groups across the full spectrum of the firmâ€™s portfolio enabling specifically relevant products, additional products or services to be directed at the relevant customers. The second key area is the insights data can provide around customer behaviour. Research tells us that organisations that leverage customer behavioural insights outperform peers by 85 percent in sales growth and more than 25 percent in gross margin. (Behavioural economics, Gallup, Gallup.com) So, what does the future hold? We see an amalgamation of data, machine learning and artificial intelligence (AI) in the future. The future of data in customers services is in the automation of responses, and it has already begun; telematics within insurance, the internet of things (IoT) tools within homes, water sensors, leaks sensors are all examples. It takes your customer services to a whole new level and ultimately benefits your firm because there are going to be reduced costs in claims and it benefits the customer in the end through cost savings as a by-product of efficiency gains.
mall businesses in the UK are increasingly turning to digital for their insurance needs, over the smartphone or other devices. Whilst personal lines and commercial lines differ in the types of data and processes used for underwriting, increasingly companies, and especially SMEs, are looking for a similar streamlined service to that which they enjoy in personal insurance.
A survey by PWC found that 43% of small firms purchased their last business insurance policy online. More than two thirds (68%) of small businesses who plan to switch insurance providers in the next two years say they want to do so online. So the battleground for retaining and serving business customers is going to be increasingly in the digital space, even for commercial insurance that has been traditionally dominated by manual underwriting and often large and complex risks. This trend was echoed by our LexisNexis Risk Solutions survey of commercial insurers, which found big variations in attitudes towards the types of data that commercial property insurers find valuable. Essentially all commercial property insurers use some type of location-based data in quoting and underwriting. However, according to our survey, no single source of data is used by more than half of insurers. Flood, fire and other perils data are the most commonly used. In many ways the trends that we are seeing now are just the tip of the iceberg. There is a wealth of data that is already out there, ready to be brought to the table. If we think of flood, fire, crime and theft data that are being left unused by more than half of insurers in most cases. Then there is data on company directors, business activity, market risk scores and claims history, which are some areas where our survey found insurers are seeking to broaden their underwriting approach. These are the types of data inputs that are going to be necessary in the future to bring about automation and service improvements, such as prefill of the application or claim form. Using technology and new data sources, commercial insurers will increasingly be able to bring more knowledge about the customer to the point of quote. Looking ahead there are many ways commercial property insurers are going to add value for businesses and especially SMEs, with better use of in-house data and customer data from new sources. Trevor Lloyd-Jones, Senior Marketing Manager, Insurance, LexisNexis Risk Solutions.
Paul Tasker, Managing Director, REG UK.
Modern Insurance 29
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What does the data tell us? What role does data play in customer service, and how do you see this evolving? n my experience, I would say data unfortunately plays a small part in customer service today… I believe that data in general is not leveraged for maximum value across the insurance and motor supply chain world. I have always worked in customer service businesses and have always been fascinated with data and what it tells us. The area that has always interested me most, is that of the relationship between data and customer service. I joined the ‘motor claims’ world in 2005 and was amazed by the amount of data collected, it was a significant change to what I had been used to. I was genuinely excited about this and was keen to maximise this in my quest for the very best service delivery of my then business, Nationwide PLC. My excitement was relatively short lived as it soon became apparent that the data was only ever used to reprimand suppliers on their performance. I have no issue with this by the way, my prior background of Kwik Fit and Phones 4u were no strangers to this activity. However, what they did very well was also use the data to better serve customers and also highlight the opportunity to diagnose root cause analysis. It’s a misnomer that all complaints sit with the supplier (don’t misunderstand me here, many do!), there are other factors where the effective use of data will identify this. There is an old saying that my team get fed up of hearing me say: “What’s the definition of madness? Doing the same thing twice and expecting a different result!”. Therefore as an industry we have to be better at using the data to identify trends and rapidly find the solutions, instead of just expecting the supplier to sort it when it is not always in their control. The supplier has to swallow the same pill though, what are they doing that keeps going wrong and impacting on customer service?
The most obvious opportunity for me with data and I genuinely believe this will evolve. Insurers should leverage the positive results from customer surveys to proactively contact customers (not policyholders – see my editorial in issue 33) and capitalise on their ‘positive view’ and offer to renew their policy at this point or offer additional services (motor, pet, home). Steve Thompson, Director, Industry Insights.
A new approach to business models How are new and emerging technologies revolutionising some of the processes involved in the insurance industry? ithout the constraints of legacy systems, we’re seeing a rise in flexible policies on demand. Wrisk, for example, provides flexible coverage that covers you for the specific risk you have, and for the exact amount of time you need protection for. Using their intuitive smartphone app, you can adapt your coverage at any time so that you’re never underinsured or overcharged.
Special interest communities like BoughtByMany are using a social media approach to the buying process for insurance policies, using groups of buyers to negotiate the deals and discounts that individuals cannot access alone. P2P insurance products from Guevara or P2P Protect have eliminated the need for an insurer altogether. In customer support, whilst live chat has long been the most popular method of communication, recent improvements in machine learning and natural language processing, alongside a shift towards web-based chatbots like Claim Technology, mean that customer interactions are increasingly being serviced by a bot-first approach. This can then switch seamlessly to a customer agent where necessary. On the claims side, many time-consuming steps in the claims journey are being enhanced by Artificial Intelligence to provide claims handlers with augmented intelligence decision tools. Look at how RightIndem have made it an average of three times faster to make a decision on liability for their claimants, or how Photocert use blockchain to avoid fraudulent photos being entered as evidence in a claim. Increasingly, we will see Artificial Intelligence reach a level that is faster, cheaper and more accurate than human decision-making altogether. When combined with robotic process automation (RPA) offered through claims automation platforms like Claim Technology, this could make the claims process entirely ‘touch-free’, freeing up human agents to focus on value-added service. We can already see a glimpse of this with the growth of parametric insurance. AXA’s Fizzy product is an insurance policy that covers you in the event of a flight delay. Built on blockchain, the ‘smart contract’ is automatically triggered to make a claims payout based on publicly available, real-time flight data. The insured party doesn’t even have to submit a claim. The technology advancements in Artificial Intelligence, chatbots and blockchain are revolutionising insurance processes, opening doors for entirely new business models. Michael Lewis, CEO, Claim Technology Ltd.
Modern Insurance 31
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The personal touch Are the benefits of the human touch being overlooked in favour of technology? ith the rise of advanced technology and artificial intelligence, there is a concern in the insurance industry that robots and automated systems will begin to replace jobs, leading to a loss in genuine human interaction. In reality, it is unlikely that this will be the case, especially for EDAM Group operating in a credit hire industry where service expectations are high. By offering efficient post-accident customer mobility and exemplary customer service, our business acts as a trustworthy partner for those involved in non-fault accidents, managing subsequent claims effectively with an added personal – and human – touch.
As a post-accident credit hire business, many enquiries we deal with are made at a highly stressful time for the customer. They could fear anything from prolonged time off the road, damage repair costs, or a loss of no-claims bonus. The last thing a driver in this situation needs is an emotionless, automated response with no sign of empathy. We, however, aim to make the end-to-end process as easy as possible for the customer, delivering assurance that we will act with integrity at all times and with the customer’s best interests in mind. Furthermore, claims processes are not always straightforward. Human advisors can better determine the specifics of a case quickly. To train and support its team, EDAM Group launched its Claims Academy earlier this year. Developing the skills of new recruits to enhance the customer’s journey and provide better service at every point of contact. It is this investment in customer care that positions us as a market-leading service provider. EDAM Group does not disregard the clear benefits of technology. The company integrates systems which embrace both smartphone and web-based means of gathering customer feedback in relation to Net Promoter Score (NPS). NPS determines the level of customer satisfaction on the basis of genuine feedback and is a useful metric to help continuously improve service. EDAM Group’s exemplary and market leading NPS score is a true reflection of its personal customer service. The business makes the best use of technology, but ultimately does not let it interfere with the personal customer service with a human touch that we believe is so important. Marc Lafferty, Chief Revenue Officer, EDAM Group.
Communication key to public education What steps should be taken to improve public education of insurance, claims and associated services in order to help customers? efore I started working for Auto Windscreens, my interest in motor insurance was in all honesty limited to the yearly renewal of my cover. Many people I talk to are the same and this undoubtedly presents a challenge when trying to educate them about policies, claims and additional services. Vehicle technology, which is undeniably developing at an extraordinary rate, is perhaps a more appealing topic, yet it is a good example of where an improvement is needed when it comes to customer education. Do people really know what Advanced Driver Assistance Systems (ADAS) they have on their vehicles, how these are covered by their insurance and how they may impact their claims journey? Many of our customers, for example, are unaware that they have ADAS-packed cars that need recalibrating after a windscreen is replaced and that this will result in an additional step in the glass repair process. Knowing about this would help them avoid repairers who use incorrect recalibration methods or do not recalibrate at all, putting them at risk of malfunctioning safety features, such as lane departure warnings. Would a policyholder know where fault would lie if an incident happened because of such a malfunction or if this is written into their policy wording? Communication is key to ensuring drivers are educated on this and other topic areas in my opinion. It is what we at Auto Windscreens have embraced through our ‘Let’s Talk about ADAS’ forums, although aimed at insurers rather than policyholders. We have created an open and honest dialogue with them and it is this that needs to be replicated with policyholders. There needs to be a clear outline of what these technologies mean to drivers and their safety. There are so many communication channels available to us and no reason why we shouldn’t be utilising them better than we already are. Insurers still seem wary, but social and online platforms create ideal environments where fun can be put into insurance and policyholders can be educated engagingly, not only about technology but all aspects of insurance. Fully embracing these could have a huge impact on a customer’s experience and understanding. It could also mean that people aren’t just thinking about insurance when their policy is up for renewal!
Rupert Armitage, Managing Director, Auto Windscreens.
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Are we missing the benefits of the human touch? henever a customer contacts their insurer to make a claim, it’s impossible to know in advance how much it matters to them. They could be telling you about something relatively trivial like accidental damage to their mobile phone, or about something absolutely vital, like a burglary.
That means we can never predict exactly how our customers would like their claim to be handled. And no algorithm will ever be able to either. For example a time-poor customer might be happy to progress their claim entirely online. Another might want to speak to someone at the beginning of the process, especially if they are a first-time claimant and want to understand what to expect, but then switch to technology. Others will want personal contact throughout. At Ageas, we believe the decision about how their claim is handled should be the customer’s and the customer’s alone. We also believe that we should try to add value to the process wherever we can, and that means working hard to provide solutions that meet the needs of the customer. Making a claim on your insurance might not seem very much like doing your online shopping, but that doesn’t mean that insurers can’t learn from online retailers. They offer their customers a range of ways to get what they want, how they want, when they want it – be it home delivery or click and collect or simply to check stock or the progress of an order. Technology enables insurers to take a leaf out of the online retailers’ book, and offer customers more choices. It can speed things up and give customers 24-hour access to progress and track their claim, so that it can be settled more quickly and with total transparency. Insurers have been quick to adopt technology because of the efficiencies it offers, but we must always remember what customers’ value about us. The decision to opt for technology must always be a positive choice by the customer – not made for our convenience. We must never lose the human touch that is at the heart of the personal service our customers want. That’s the only way we’ll manage to keep them – and keep them happy – in the years to come. Robin Challand, Claims Director, Ageas.
Can insurers and rehab providers collaborate to reduce the cost and lifecycle of a personal injury claim? Y
es, I believe we can.
I also believe we have a shared responsibility to ensure that claimants are not only financially compensated, but that their pre-accident physical and psychological wellbeing is restored as quickly as possible. Rehabilitation is often disregarded, for a variety of reasons. The claimant may not see a need for physiotherapy or understand the many benefits. There also seems also to be an assumption that rehabilitation may significantly delay case settlement. However, by working together the industry can overcome this, delivering costeffective rehabilitation for injured claimants to the benefit of all parties. Typically, physiotherapy is provided for claimants following recommendation by a medico-legal expert. Medcare, however, can reduce the lifecycle of the claim by up to 21 days by undertaking an early-intervention triage assessment before the medical has been arranged. Claimant solicitors who pre-authorise any recommended physiotherapy sessions can reduce the cycle by another four days. There is a surprising price differential across rehabilitation service providers and I would also like to see fair and consistent pricing, with direct payments from insurer to service provider. Replicating some elements of the MROA scheme could negate the need for protracted discussion between the compensator, claimant solicitor and service provider - thereby speeding up the settlement process. Interested parties’ operational processes should also be reviewed with a view to maximising efficacy. Both claimant solicitors and service providers need to respond swiftly to recommendations of treatment, managing such referrals sensitively and to defined service levels. Medcare, for example, have an uncompromising commitment to efficiency, ensuring the treatment process integrates with the medical reporting process with minimal touch points, and so speeding up case settlement. We have a collective responsibility to ensure rehabilitation is accessible for all. Our biggest challenge may lie ahead with the proposed Civil Liability Bill as we consider how to ensure Litigants in Person retain access to rehabilitation. This will fundamentally challenge the traditional ways of working for many rehab providers but we must continue to focus on placing claimant’s wellbeing at the heart of the process. Brionie Clegg, Head of Business Development, Medreport.
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Modern Insurance’s panel of resident associations outlines the burning issues
Streamlining the system echnology has made operational efficiency a sexy topic, and with good reason. When the CII published its trust index in July, our survey of consumers and small businesses showed that paying claims quickly was the single biggest factor they looked for in an insurer. What makes this finding even more remarkable is that most consumers already thought their insurer did a reasonable job of paying claims promptly. The message was, ‘the system is slick, now make it slicker’.
It’s great to see that competition is increasing performance in claims, but alongside this lies another challenge - making the market as a whole more streamlined for all members of the public, and not just those of us who are lucky enough to pose relatively standard risks. For people with disabilities or pre-existing medical conditions, including mental health conditions, it may be that only a minority of underwriters can give them the cover they are looking for. Many of them will look at options on a comparison site and give up when they don’t see a solution for them among the hundreds that are quoted.
BIBA does excellent work in travel insurance, offering signposting for people with pre-existing medical conditions, and is working with the FCA to develop the promotion and effectiveness of the service. However, there is no current equivalent for people who face similar issues in the retail income protection market. The DWP has launched a piece of work to bring charities, practitioners, professional bodies and trade associations together. They have pledged to take action on issues across all insurance markets for people with disabilities and pre-existing existing health conditions. It is led by the indefatigable Johnny Timpson, from Scottish Widows, and it deserves support from across the profession, as it tries to make the system more streamlined for everyone. Dr Matthew Connell, Director, Policy and Public Affairs, Chartered Insurance Institute (CII).
The salvage code he salvage code is a great example of the insurance industry working together for the good of the general public. When a vehicle is written off, the salvage code sets out guidance for insurers and salvage agents regarding how it should be categorised and, consequently, what can happen to it next. While each individual insurer has its own arrangements with salvage firms, the code means that damaged vehicles are dealt with consistently and in accordance with criteria that have been decided on, and scrutinised by, subject matter experts – including vehicle manufacturers, the salvage industry, motor traders and the police. It has been claimed that the way in which the code operates means that there are more repairable write-offs available than there are parts to fix them. This has led organised crime gangs to steal cars to order to provide spare parts. Stolen cars are broken down in “chop shops”, back street garages or industrial estate units, and the parts are then used to repair write-offs. In many instances, these cars are not particularly well put together, are not fit to drive on the road and seriously endanger the safety of unsuspecting buyers and other road users.
As an industry, we share the concerns of the police that criminals are abusing the system to make money. The fact that the rate of vehicle theft is increasing is concerning, let alone any increase of unsafe vehicles on the road. The ABI is working alongside the police to help find a solution to this issue. We applaud West Midlands Police for having recently launched a crackdown on the garages where stolen cars are being processed. The other key step to tackle this problem must be increased scrutiny of the market and tighter rules for vehicle repairs. There is currently no requirement for repaired write-offs to be checked before being sold. They can be returned to the road without an inspection until they reach MOT age. Requiring written off cars to undergo an individual vehicle approval (IVA) test before being put back on the road seems an obvious step to crack down on these criminals and increase protection for all road users. Laurenz Gerger, Interim Policy Adviser, General Insurance, Association of British Insurers (ABI).
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Innovation progress… What progress? e constantly read in the insurance press about the new developments in various aspects of the insurance buying and claims handling process, but is everything that is classed as innovative actually achieving an improvement either for the customer, the insurer or the broker?
There is no doubt that the advent of end-to-end e-trade capability has greatly improved the transaction of certain classes of insurance where the unit cost to deliver that business to market is reduced. But in places such development could have facilitated a number of poor buying decisions by the client, which may in turn have resulted in a growth in complaints in the claims arena when the policy did not respond as expected. There are many that continue to be hampered by the UK’s poor data infrastructure. Wi-Fi and mobile networks in certain places are not sufficiently advanced to carry the speedy connectivity that is essential. Technology exists to enable us to transfer live pictures of a claims scene to our office and use HD photography to measure and actually adjust a claim remotely without visiting the site. This can not only reduce an environmental footprint, but get to the point of claims settlement much quicker, but not without good network coverage.
AI now exists that enables an underwriter to obtain a sufficient amount of data from freely available sources to calculate a sum insured, assess an overall risk that a client poses and also underwrite the risk without a single disclosure from the client. Having just experienced the biggest single change to transacting commercial insurance legislation in over 100 years in the Insurance Act 2016 already we will be seeing the fundamental change and the unintended consequence of how such an advancement in technology would affect the carrying out of a reasonable search, and a fair presentation of risk to an insurer by a client. Insurers will have to take responsibility for much of the risk of disclosure in these circumstances, but that would perhaps improve the customer journey when it comes to claims payment. There has clearly been progress, but we must be mindful that new technology must be of benefit and we must also be aware of the unintended consequences of introducing new ways of working and insuring risk and most importantly, consider the insurance of emerging risks, in particular cyber risk and its effect on our clients. Andrew Gibbons ACII, Mason Owen Financial Services Ltd, Chair, Industry Claims Initiative on Behalf of BIBA.
Court of Appeal upholds ENRC’s claim to litigation privilege SFO v ENRC n 5th September 2018, the Court of Appeal (CoA) handed down an important judgment concerning the issue of litigation privilege. In essence, the CoA has reversed the High Court’s decision in Director of the Serious Fraud Office v Eurasian Natural Resources Corporation Limited (ENRC v SFO) 2017. Last year in the High Court, Mrs Justice Andrews found documents generated by ENRC during investigations by its solicitors and forensic accountants were not protected by privilege due to the fact that, when they were created, criminal legal proceedings were not reasonably in contemplation. This judgment caused widespread concern within the legal community. The CoA has now confirmed that litigation privilege would be engaged whenever the circumstances of a case are such that “there is a clear threat of a criminal investigation”. On legal advice privilege, the Court of Appeal decided not to clarify its 2003 decision in Three Rivers, which applied a narrow definition of ‘client’. The CoA felt this fell beyond the scope of the present appeal and would, in any event, require final determination by the Supreme Court. However they did indicate, had it been open to them, they would have been in favour of adopting a wider definition.
investigate incidents under the umbrella of litigation privilege were civil litigation or a prosecution is reasonably contemplated. However, the Three Rivers decision remains in play, which means care needs to be taken when interviewing employees and making notes during the investigation stage and especially when that exercise is undertaken by non-lawyers. If litigation privilege does not attach – and each case is fact specific - such interview notes may still be disclosable. Practically, organisations need to carefully consider the advisors instructed at the beginning of an investigation and determine the persons within the organisation who will be their “client”. Appointing specialist legal advisors to assist with internal investigations may strengthen any claim to privilege and help ensure privilege continues to attach to the documents in question. Disclosing documents to a third party should be done in confidence so that privilege is not waived. Keep reports/notes/ covering correspondence factual – the additional commentary may not be privileged unless it is legal advice from a lawyer. With the SFO not set to appeal, at present the trend appears to be moving away from a narrow interpretation of privilege.
The decision is good news for those facing criminal or regulatory investigation and encourages companies to
Chris Newton is a member of the Regulatory SFT at the Forum of Insurance Lawyers (FOIL) and Partner at Keoghs.
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Not too late? t offends an important principle of justice. The legislation deliberately introduces injustice into our law. It involves discrimination against legitimate claimants, irrespective of their means.
These powerful words are not mine, but those of Lord Woolf, former Lord Chief Justice for England and Wales and Master of the Rolls. Forming part of his razor-sharp denunciation of the proposed reforms, his words resonated with many of his peers and anyone concerned about justice should be reciting them to all who will listen in the weeks ahead as the Civil Liability Bill reaches its final stages. Many of the proposed changes are probably unwanted. Most are undoubtedly misdirected, designed to tackle a fraud problem that is overstated. Or, as the number of claims continues to tumble, a cost-saving exercise that is clearly unjustified and which will benefit absolutely no-one, apart from the insurance companies themselves. All the while there continues to be dithering over other pressing measures, such as the now fabled Part 2 of the reforms. Unwanted though the new processes may be by claimant solicitors, they can probably be accommodated, although not
without considerable discomfort. No, the real damage to justice is not going to result from the architecture of the processes being proposed, but their implementation. Introduced in tandem at the current rates and levels proposed, the fixed tariff scheme, one of the pillars of the Civil Liability Bill, and the increase in the Small Claims Track Limit, will fundamentally change the claims landscape for whiplash and related injuries, severely reducing the likelihood of independent legal advice for the victims of so-called low value motor accidents. When combined with the new online-only LIP Portal, a gateway for CMCs, the impact will be permanent and nothing but detrimental to claimants. Even as the end of the Billâ€™s passage through Parliament draws near, it is not yet too late. Both the tariff of damages and the new small claims limit could both be set at levels that are fairer and more reasonable for accident victims. The rights of individual accident victims should be protected, and the honest majority should not be punished for the actions of a small and dishonest minority. Simon Stanfield, Chair, Motor Accident Solicitors Society (MASS) and Partner, Simpson Millar.
How evidential video is transforming claims John Ridd, CEO, discusses how the introduction of video technology is improving business processes and the customer claims experience.
ransformational’ is a bold claim to make for technology, but there is a growing body of proof to show that evidential video capture is proving to be just that for the insurance market.
While still a relatively new technology, the ability to capture secure, time-stamped video evidence via an everyday smartphone is proving to be a game-changer. It is significantly improving business processes and policyholder experiences while also saving time and money – a win-win. Let’s look more closely at the evidence.
What is evidential video?
Put simply, evidential video is created via specialist software on a smartphone that allows it to capture tamper-proof, time-stamped video evidence that can be relied on in court if necessary. It can be used by everyone involved in the claims process – from the policyholder providing evidence of damage to loss adjusters who may no longer need to visit the scene but can conduct their assessment via a live video feed from a junior team member or policyholder, or by reviewing a recorded video submitted to a central hub. The benefits are multiple – and they apply across the whole of the supply chain right through to the policyholder.
Saving time is a key benefit – video evidence dramatically speeds up what has historically been a cumbersome, paperbased claims process. In a recent white paper, technology analyst Cognizant estimates that evidential video technology could cut up to 16 days from the lifecycle of a typical property insurance claim. Other estimates show that removing the need for physical visits can reduce the cost associated with customer interviews by up to 70%. A major insurer reports being able to establish fault and capture a third party injury claim within 24 hours through video – a process that would normally have taken weeks or even months.
Improving customer experience
Saving time isn’t just a benefit for the insurer, it’s also a huge benefit for the policyholder, whose claim can be resolved more quickly and efficiently and with minimum hassle. Insurers who are using video technology for policyholders report that their customers find it quick and easy to use and are very positive about the experience. In some cases, customers have received settlement within hours of uploading their footage. Improving customer experience in this way can create a strong competitive advantage for the insurer.
Saving time of course equates to saving money, too. Cognizant
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Improving customer experience in this way can create a strong competitive advantage for the insurer estimates that using video could save up to 10% of claims costs in the validation, investigation and adjusting phase alone. A major insurer using the technology has found that in 80% of cases there is no need for third party loss adjusters to carry out site visits. It predicts this could rise to 95%. Such statistics demonstrate the genuinely transformational nature of this technology. It is not just about adding the technology into an existing process – forward-thinking insurers are using it to fundamentally reshape the way they work, and they are seeing benefits throughout the whole of the supply chain.
Looking to the future
So where do we go from here? Evidential video technology is already delivering strong benefits but there are even more exciting prospects ahead. Suppliers and customers are already thinking about future applications, including the potential for video data analytics, AI and Augmented Reality, to name but a few. Insurers who get on board with video technology now will have a significant competitive advantage in the future, as they will be best positioned to shape its future capabilities and business benefits. John Ridd is CEO of eviid. www.eviid.com
Industry Innovators Interview: Mphasis Modern Insurance spoke to Guru Grewal, Head of Europe, about new technologies and solutions that are powering insurance businesses into the future and what opportunities Mphasis are therefore creating for the industry.
Being customer centric is the foundation of Mphasis and is reflected in our Front2BackTM Transformation approach, which uses the exponential power of cloud and cognitive to provide hyper-personalised digital experience to our clients and their end customers most of whom are millennials. Our service transformation approach helps to ‘shrink the core’ through the application of digital technologies across legacy environments within an enterprise, enabling businesses to be adaptive thus helping them stay ahead in a changing world.
It’s better to architect the disruption rather than wait to be disrupted
How would you describe Mphasis in three words?
What makes Mphasis different from traditional insurance businesses?
As a company with customer-centricity at its core, we offer insurance businesses an external perspective, highlighting trends that enable digital transformation for companies of all sizes to meet the current and future requirements of their customers. To transform the business model, we partner with brokers, insurers and re-insurers to implement disruptive technologies and upgrade legacy environments using our X2C2 framework (Anything to Cloud, Powered by Cognitive), which is implemented through two of our key approaches. We implement a customer-centric Front2BackTM (F2B) transformation approach to drive growth and enhance customer experience thus building new digital capabilities with businessdriven KPIs, teaming up with our clients to jointly drive measurable top and bottom-line results. In doing so, we leverage state-of-theart reference frameworks and capabilities of agile transformation for quick results that increase over time. In addition to the benefits of rapid payback, our expertise in analogue to digital transformation helps address the required power-sharing between
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business and IT as well as design a F2B solution to minimally disrupt existing systems and infrastructure. Our Core ‘Service Transformation’ approach helps to drive cost and operations efficiency, optimise run functions and transform the legacy applications, infrastructure and operations. Alongside traditional levers such as automation, we use a wide range of new generation technology interventions such as AI, machine learning, cognitive automation, virtual agents and cloud migration to transform legacy systems coupled with delivery methodologies such as Agile, DevOps and SRE. As a result, we are able to provide technological solutions covering the full spectrum – from modern policy admin systems based on variable pricing models for different audiences to facilitating data aggregation and workflow with a rules engine that delivers faster underwriting and improves its profitability. We’ve even got an analytics solution for both the underwriting and claims functions that uses guided decision-making and machine learning service to reduce the claims indemnity cost as well as helping identify fraud.
What would you identify as the gap in the market that Mphasis aims to fill?
With the advent of digitisation in the insurance industry, customers are demanding speed, transparency and personalised interactions. Insurance companies across the globe are expected to transform themselves to meet the needs of the next-gen customer.
In our view, insurers need to focus on what we call the 3 ‘C’s: improving Cost transparency, reducing embedded Complexity and improving delivery Confidence and pace, which are key to success Millennials are accustomed to conducting a large part of their daily lives online, anywhere anytime thus forcing insurance companies to wake up to the imperative to transform their old paper-based, agentcentric and archaic legal language to this generation’s current world. This is where Mphasis plays a major role. It enables insurance businesses to compete successfully and profitably by improving efficiency in business processes, delivering a seamless digital experience to the end customers and evolving with disruptive trends in the industry. In our view, insurers need to focus on what we call the 3 ‘C’s: improving Cost transparency, reducing embedded Complexity and improving delivery Confidence and pace, which are key to success. Some of the biggest gaps/opportunities we see in the market are: • Data Analytics (big data) & telematics: Here lies the biggest opportunity for UK general insurers to drive growth & retention while reducing costs. • As underwriting profits are going down, wages are going up by 60% (2000-12) and the average claims cost is increasing by 67% (2001-11) - insurers now need to look for innovative ways to improve profitability/stay profitable, and • With increasing regulatory environment and spike in cybercrime, there is ever growing need for compliance and sanctions screening on insurance policies. • Using the F2B and Service Transformation approaches, we have implemented several capabilities for our clients that addresses the above gaps. • How is the wider industry responding to challenges in your area of the market, and how are you tackling these?
Traditional transformation approaches fall short of addressing the industry challenges. Core system
modernisation (that usually takes three-to-five years) requires significant budget allocation, and business is unable to see a visible and measurable impact in the immediate smaller time frames. An operations-transformation approach, in addition to the above factors, involves a much higher risk as it impacts endto-end operations. Mphasis enables enterprises to address the pressing need to implement new generation technology capabilities as well as transform their legacy systems using our industryspecific X2C2TM framework (“Anything to Cloud, Powered by Cognitive”). By adopting a value chain/customerin view, Mphasis helps enterprises harness the power of cognitive technologies with the rich data that resides within their business. Specifically within the insurance sector, the X2C2TM framework is implemented through our two approaches – Front2Back™ (F2B) transformation approach and Service Transformation approach.
How are new consumer buying habits forcing change in the insurance industry?
Traditional insurance has focused primarily on being a financial safety net following an incident and paying a claim. Until now this has been a successful model and benefitted the wider economy. However, this approach has led to a very product centric business model, broad brush under-writing risk assessment and primarily a sales market that is driven by best price. With the adoption of the digital economy and technologies by customers, insurers and brokers are transforming to: • Be customer-centric to provide hyper personalised engagement, product and service offering at each unique customer level.
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We offer insurance businesses an external perspective, highlighting trends that enable digital transformation for companies of all sizes to meet the current and future requirements of their customers • Have a data- and digital-first approach to redefine the art of risk assessment using more real data and provide continuous engagement at micro moments of truth. • Deliver risk prevention advisory and management services, as well as their traditional indemnity products.
How is technology influencing Mphasis service offering, and how will this be developed in the future?
A more interesting trend we are observing is the need for delivering solutions that can be implemented alongside existing systems – so evolution rather than revolution. We are partnering with brokers, insurers and re-insurers in several deals that require a solution-based implementation within the existing business operations of the following new capabilities: • Artificial Intelligence and Machine Learning based intelligent automation across the value chain. • Internet of Things (sensors, telematics, wearables) as data source for UW as well as claims management. • Connected Ecosystem (API First approach, Microservices) to integrate with partners for data access as well as additional value-added services to customers. • Zero UI engagement through Digital Assistants (chatbots, voice assistants) and Omni-Channel options. • A cloud-native approach to drive scale of engagement and realtime data processing. • The insurance industry has a lot of legacy when it comes to bring in integrated solutions. There is urgent need to transform the legacy to shrink the cost of operations and drive efficiencies in transaction processing.
Guru Grewal As the Head of Europe at Mphasis, Guru Grewal is responsible for the company’s growth in the European region, spanning new client acquisition and Europe-based strategic accounts. An industry veteran with eighteen years’ experience in the region, Guru has in-depth knowledge of the European market. Before Mphasis, he worked for leading global IT firms with a stellar track record of delivering rapid growth. Guru has an MBA from Bombay University.
Where do you see Mphasis this time next year?
FY 2017 was the turnaround year for Mphasis and FY 2018 was the year of stability. Following our brand refresh to ‘Apply Next’, we look forward to more successful engagements and innovation for our clients and customers every day.
What advice would you give to anyone else looking to disrupt the insurance industry?
Every company is a technology company and every company is a digital company. Instead of looking at disruption as a challenge, we look at disruption as an opportunity. This could mean the cards are getting shuffled and you could be on top of the pack. It’s better to architect the disruption rather than wait to be disrupted.
Guru Grewal is the Head of Europe at Mphasis.
What’s unique about the culture of Mphasis?
In today’s ever-changing marketplace, at Mphasis we demonstrate success through agile business processes and innovation that anticipate the future and define the next wave. Our success is built on our architectural approach, legacy of innovation and thought leadership over the past two decades that has helped us bring our future-proof expertise in ‘applied tech’ to our next-gen customer. Our new brand identify comes as an outcome of our renewed business strategy focused around cloud and cognitive technologies, whole new go-to-market strategy, creation of an innovation engine fuelled by our employees and an innovative talent management strategy with an objective of creating an army of future ready talent. Our strong culture of empowerment, learning and experimentation, is what drives us at Mphasis. Flexibility and trust are the levers that set our employees on the path to career growth and achievement. With client- centricity being a top priority, our employees are empowered to exercise autonomy to take responsible decisions. Our success being defined by facilitating such an environment, we provide all measures necessary to foster this ‘culture of empowerment’ on all levels across the organisation.
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The Internet of Insurance Conference 2018 On the 4th September, Modern Insurance attended the 3rd Annual Internet of Insurance conference. The Internet of Insurance is a leading forum for exploring how IoT and emerging technologies are enabling the insurance industry to streamline processes, manage risk and ultimately improve the customer experience. We will cover a combination of expert insights, panel discussions and case studies presented throughout the day, all emphasising the need for a better understanding of emerging technologies within the industry. pening the conference was Matt Cullen, Assistant Director, Head of Strategy, Data and Analytics at the Association of British Insurers (ABI), who highlighted the need for insurance firms to reflect upon their strategies. The Internet of Things (IoT) is a growing topic of conversation both in the industry and outside of it but it is a difficult concept to define. It is ultimately described as any device or physical object that is connected to the internet, collecting and sharing data. IoT will ultimately open up new routes of opportunities and will surely help to solve some of the problems we face today in terms of streamlining, data sharing and customer care. As an industry we have been slow in our adoption of digitisation, however we need to close that gap if we want to showcase ourselves as leaders in digital innovation.
Data is rapidly becoming a valuable asset in insurance and one that we need to fully utilise and take better advantage of due to the fantastic opportunities it can offer our market place. Not only can it improve decision making and the products on offer, but it will ultimately offer better customer experiences. After all, it is customer behaviours and attitudes that are driving the change in the industry. With the use of data, there is the possibility that we will be able to anticipate our customerâ€™s needs and therefore meet their high expectations.
Every business needs to implement a data strategy The first keynote address was delivered by Davide Burlon, Head of Actuarial Analytics at Generali. He discussed how machine learning could transform the insurance industry, which could ultimately give rise to making insurance a model-driven business. Machine learning is a branch of artificial intelligence (AI) that is based on the idea that systems can learn from data. Machine learningâ€™s basic goal is to enhance and not to act as a substitute, therefore forcing us to re-evaluate our procedures and how we can utilise this technology in order to streamline our businesses and work much more efficiently. From the questions during the first session there was a lot of expectation surrounding machine learning but it became clear that there is still so much we need to understand about it first before we can start applying it on bigger scales.
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IoT will open up new routes of opportunities The panel discussion focused heavily on IoT and its associated challenges and opportunities. The participants were Matt Cullen, ABI; Ed Dutton, CEO of British Gas Insurance; Jonathan Phillips, Head of IT and Change at CAN Hardy, and Rob Davis, Vice President of Product Management at MicroStrategy. The conversation began with looking at what benefits businesses can gain from utilising IoT effectively, as well as how customer outcomes and customer value can be improved. It was stated that we need to work on the connected home as this welcomes the opportunity to install an ecosystem into people’s homes that will have multiple applications, of which insurance is but just one. Although the insurance industry wants to focus on improving the claim’s experience, it was suggested that we need to start with the customer and what benefits we can offer them. From there, the panel questioned how we can start making IoT happen and utilising the data it collects to provide the customer outcomes that we need. It was emphasised that every business needs to implement a data strategy. IoT’s data comes from all kinds of different sources but it also comes in different formats, so the conclusion of this session was that businesses need to create a strategy that allows you to handle a large volume of data, for it to be quick and efficient but also user friendly and easy to understand. It will be interesting to see how and when insurers develop these strategies.
The final segment of the day was dedicated to the InsurTech Innovation Den. Before we met the start-ups gunning for the title of Innovation Den Winners 2018, we were introduced to the judges through a discussion of ‘An Investor Insight into the trends and innovation in InsurTech’. They spoke about disrupting the market, the Amazon effect and importance of finding the right partner when investing in new technology. The partnership between the insurtechs and insurers is critical. The insurtech can offer a new way of solving business problems while the insurer can offer an endless network of business. It is an important collaboration that will ultimately help to create a progressive and exciting landscape. We then moved onto the pitches from dacadoo ag, Spotsee and XSure; all three of which gave a detailed outline of their business and prospects, but dacadoo ag proved to be the overall winner. Overall it was a very informative day with a great number of speakers. We heard from insurers, start-ups and tech providers about the huge untapped potential of IoT, data and machine learning as well as other emerging technologies, but also some of the concerns and pitfalls that we need to bear in mind as an industry, such as cyber security, responsible use of data and not over complicating simple concepts. We are thoroughly looking forward to next year’s event and seeing the progress the industry makes in the meantime. Poppy Green is Co-Editor of Modern Insurance Magazine.
48 Modern Insurance
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Modern Insurance spoke to Jen Shorten, Data Transformation Principal at MarkLogic, about how technology is driving change within the industry, and how insurance companies need to be effectively harnessing customer data in order to remain competitive.
What is involved in the role of a technical delivery architect?
insurance companies particularly need to embrace the idea that to compete in the digital world they must also be technology companies
As a solutions architect at MarkLogic, I work to design the best possible technical solutions for our customers’ challenges. I work closely with customers to understand their requirements and how we can build the best solution that will allow them to harness their data to meet key business goals. My role at MarkLogic differs from many traditional software development roles, as solutions architect is more of a behind-thescenes technical position. At MarkLogic, however, the role is about engaging with customers on both a business and technical level. This allows us to be very responsive to customers needs and build a solution for them that not only meets but exceeds their expectations.
How are emerging technologies changing the delivery of products to clients?
a company’s history to gain insight into what precedents are relevant for claims decisions.
At MarkLogic we take a different approach to solving the seemingly insurmountable difficulties of data integration in large organisations. Insurance companies, especially older ones, often have large amounts of valuable data that cannot be accessed or utilised. This data takes many forms, not all of which are readily understandable by traditional database solutions.
This solution of making data available for day-to-day operations across a business is what we call an Operational Data Hub (ODH) and is a design pattern that we have seen emerge across multiple industries over the past few years. It focuses on allowing companies to gain a 360-degree view of their data, customers, documents and systems.
These solutions, which are often tailored to deal with one problem, have simply not worked to solve the data problem. They either leave a large amount of unstructured data untouched or require a big team to restructure the data into a format the systems understand. This is completely impractical for large insurance companies who must optimise to stay competitive. At MarkLogic, we work to make all our customers’ data accessible and useable, creating new solutions that elevate their businesses.
For example, if you’ve insured a building that has suffered a leak, you should be able to quickly and easily search a company database to find all similar cases and see which ones paid out and why. Having a 360-degree view also brings other benefits, such as being able to sell more tailored packages to each customer based on their profile and needs, and data protection benefits as if you have control over all of your data you can also secure it and delete it as needed.
The MarkLogic platform excels at processing large amounts of structured and unstructured data and making that data available for searching and other more complex functions. For a predominantly document-based industry such as insurance, this means the important narrative data in a contract for example becomes usable and accessible in a whole new way. For example, you could build an algorithm for collating similar cases across
50 Modern Insurance
How can technology drive business improvement?
For every industry, not just insurance, it is important that technology is not simply viewed as a ‘supporting player’. But insurance companies particularly need to embrace the idea that to compete in the digital world they must also be technology companies. This means adopting and utilising new technologies
IT can no longer be viewed as a back-office function as it is now an essential contributor to the process to innovate and to provide new services in every part of their business. A critical part of this step is digital transformation and solving the data integration challenge. It’s only the companies that have successfully navigated these two milestones who will be able to harness all that new technology has to offer.
At MarkLogic, our product innovation is driven by our customers. We work with customers to understand what the new emerging challenges are and where they are having problems. We also work with customers that are pushing the boundaries of our products, which really helps us to drive further innovation and ensure that MarkLogic is evolving in the right direction to support their business needs.
Jennifer Shorten is Technical Delivery Architect for Consulting Services, EMEA at MarkLogic. She joined the company in 2014 after six years working on MarkLogic implementations with some of the world’s leading media and publishing companies. In her seventeen years in the industry, Jen has helped customers meet their strategic goals by overcoming data and content challenges. Jen has a particular interest in semantics and has had the opportunity to lead the UK consulting team on some of the most advanced semantics implementations for MarkLogic customers globally.
I am part of the services organisation and part of my job is to help deliver positive customer outcomes, so getting feedback from business users about how things are working is essential to make sure we are delivering value with our software.
Originally from New York City, Jennifer holds a Bachelor’s Degree in Biopsychology from Hampshire College and an MSc in Technology Management from NYU Polytechnic School of Engineering.
Why is it important for the technical architect to maintain a good relationship with the customer?
How can collaboration be used more effectively in the sector?
What I see in a lot of insurance organisations is that there has historically been a separation between IT services and the rest of the business. Those companies that have been the most successful in driving innovation have broken down that barrier. IT can no longer be viewed as a back-office function as it is now an essential contributor to the process. When there is great collaboration between all those functions in a business that is what truly drives the best cutting-edge development.
Jen Shorten is the Data Transformation Principal, Insurance, at MarkLogic.
Modern Insurance 51
Incident investigation Modern Insurance gathered together a range of experts to offer their insights when examining the intricacies of an incident.
Silent witness The Expert Witness team at TRL discuss the amount of untapped data within the industry and how this could be the key to assisting the correct analysis of issues within a case. nformation technology has become central to so many factors in life nowadays, and none more so than in the transport industry. Modern vehicles measure and record vast amounts of information, however most of this data is untapped simply because of the limited awareness of its existence.
How fast was it going, where was it going, did the driver brake, were the lights on, and was a mobile phone being used? These are questions we are regularly asked and by using specialist software and tools, together with traditional reconstruction techniques, these questions can be answered swiftly and reliably. CCTV systems, including dashboard cameras (or dashcams), are becoming routinely available and can provide invaluable evidence in relation to the speed, movement and reactions of the parties involved in a collision or incident. We regularly perform a process called ‘camera matching’ where, with the use of laser scanning and 3D modelling, we are able to accurately track the movements of a vehicle prior to a collision. Increased popularity in ‘wearable tech’ means more and more data is available from fitness tracking devices and apps. Our experts can extract and analyse GPS data from a range of sources including mobile phone web apps and cycle computers. Accuracy can vary dependent on the hardware and software in use; we can carry out practical testing to determine the accuracy and show what level of precision a particular recording is subject to. Data can be used to reconstruct events and can quickly support or refute different parties’ versions of events.
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Digital evidence is often the silent witness to an accident Expert Witness team, TRL Digital evidence is often the silent witness to an accident. Captured and stored via an Event Data Recorder (EDR) on a vehicle, data can be retrieved with details of the events which occurred in the seconds before and after an incident. In a recent case this data was used to ascertain whether a policyholder had been negligent in a collision or had in fact suffered a medical episode. Our expert achieved a successful data download; rapidly confirming that the vehicle systems were functioning correctly and establishing that no brake application was recorded and there was no significant change in engine speed or steering angle prior to the collision, suggesting that the policyholder had been unable to exercise control of the vehicle to take avoiding action. There is an old saying in the computer world - garbage in, garbage out. That could be your fate if you do not commission data analysis from a trusted source, and your case could collapse ignominiously. Phil Balderstone, Vehicle Examination Consultant, Victoria Eyers, Investigations Consultant and Dean Beaumont, Accident Reconstruction Consultant, are all part of the Expert Witness team at Transport Research Laboratory (TRL).
Virtual v Physical
s a company that specialises in providing solutions that have data at the centre of everything that we do, we often get asked about how we as a business can support the complexities that the industry faces when it comes to estimating and repairing cars.
Data, and in particular AI, is really starting to become a buzz word for this industry, it’s almost held up as the holy grail and this may of course be true but I believe that we are a little way short of this being the case.
The main problem was the time spent travelling to only to find minor damage. This could take ten minutes to assess and record, meaning that the vast majority of an engineers’ time was taken driving rather than engineering.
It is clear that there is an awful lot of data now being captured from vehicles, there are numerous companies that now specialise in attaching black box devices to cars in order to allow, for example, quick notification of an accident happening through the data sent from the black box to the mothership. How effective this information is or indeed can be will support the process and in theory will make estimating and inspection of damage vehicles a much more effective, quicker and up to date process.
Remote Video Inspections
This is where AI will start to lead the way, we can already see valuable data in terms of speed of impact, G Forces involved in the crash, where the vehicle is situated and many other valuable bits of data, the clever stuff is then using this data in a way which supports decision making at the earliest opportunity. Can we get to a space where we can say for certain that a 40 mph crash on the right corner of a Ford Fiesta is going to result in the need for a new wing, bonnet, grill, headlamp and what difference another five mph would add either way? Not with certainty no, but how much more valuable would the data be if this information could be ascertained from the car and then passed on to the repairer and engineer. Add to this information the value of the car and the total loss valuation and before you know it, your car data is telling you the best thing to do with the damaged vehicle.
One of the first victims of technological advancements was the traditional motor engineer. The process of physically travelling to a crashed car, examining it and reporting back would normally take a two to three days to complete.
In 1996 I was working as an estimator at Howard Basford when Guardian Royal Exchange (remember them?) trialled a system in conjunction with BT called Remote Video Inspections (RVI). An estimate would be sent to the insurer. Then at an agreed time, we would don headphones, microphones and video camera and await a ‘call’ from their engineer based at the other end of the country. We would walk the camera around the damage, sometimes guided by the engineer, and negotiate repair methods and costs just as if they were standing next to us.
Today most virtual (or desk-top) inspections are carried out via an estimate and series of images taken by the repairer, often on an estimating system’s network. We also use live conferencing video, which can be handy when more than two people are required in the conversation (e.g. a fleet manager, broker or vehicle owner). Multiple video estimates can be stored these days in HD, very cheaply.
So what is better?
In terms of speed, a desk-top can be completed the same day; in a matter of minutes in urgent situations. API links mean instantaneous information transfer. A desk-top report requires no travel so the cost is significantly cheaper.
Data is here to stay and it’s only going to get better, what we have to do is harness it, use it correctly and effectively and then support this industry with affordable solutions that adds to and enhances those involved in this fabulous industry. Richard Taylor, UK Business Director, GT Motive.
Data is here to stay and it’s only going to get better, what we have to do is harness it, use it correctly and effectively and then support this industry with affordable solutions
So first two points to desk-top, but what about quality? The estimate is compiled by the repairer; it is in their interest to ensure their estimate is thorough and that the images support its contents. With the car being already in a body-shop, parts can be removed to allow access to suspected hidden damage if required. The physical inspection can occasionally reveal items that the repairer hasn’t spotted. The engineer can assess the ability of the body-shop to carry out the repairs. It can also allow the assessor to carry out tests for forensic cases; paint transfer, impact measurements, paint depth checks, etc.
For the vast majority of straight forward accidents, the desk-top report is better because it’s cheaper, quicker and environmentally cleaner. Not that there is anything wrong with a physical & in some tricky situations can prove the more judicious choice. Nik Ellis, Managing Director, Laird Assessors.
Richard Taylor, GT Motive
Modern Insurance 53
The number one priority Property insurers are leaking money on escalating escape of water claims. Ian Salkeld, Head of Escape of Water, Crawford & Company, examines the reasons why claim costs and complexity are on the rise, and suggests ways in which the insurance industry can wrest back control. he rising cost and complexity of escape of water (EoW) has been a growing concern for claims directors for several years. With many insurers facing a deterioration in combined operating ratio (COR), EoW cost inflation was, in 2017, ranked among the top three contributing factors, alongside the Ogden rate change and worldwide natural catastrophe losses.
According to the Association of British Insurers (ABI), insurers paid out £654m in EoW claims in 2016 - that’s £2.5m per day and an increase of 24 percent, or £125m, on the annual figure from 2014. Accounting for 28 percent of total property claims spend, EoW is the most consistently expensive peril for domestic property insurers. In fact, our research has shown that over 50 percent of complaints registered on higher value buildings claims (>£25k) relate to EoW. Against this backdrop of rising costs, there is intense focus within the insurance industry to develop a response to bring EoW claims under tighter control without diminishing customer experience. Indeed, James Dalton, the ABI’s director of general insurance policy, described tackling the rising costs of EoW claims as the ‘number one priority’ for the domestic property insurance market in 2018. There are numerous variables that influence the cost of an EoW claim on a case-by-case basis, from property type to floor level, water source and drying method. However, trends in construction, lifestyles, housing and insurance are all converging to push the cost of a typical EoW claim upwards. Firstly, there is more water in today’s typical home. Office for National Statistics figures show that only 30 percent of homes were fitted with central heating in the 1970s but that figure is now closer to 95 percent. In 1970, 65 percent of households had a washing machine (97 percent did in 2011), and between 1994 and 2016, dishwasher installation in homes increased from 18 percent to 45 percent. Ageing housing stock in the UK is also increasing the probability of wear-and-tear-related failures in pipework. With demand for new homes outstripping supply and house prices and stamp duty on the rise, the last twenty years has seen an increasing number of homeowners decide to ‘stay put and improve’ rather than move home. Many have elected to convert loft spaces, improve kitchens and bathrooms and install wet rooms and en-suite facilities, increasing the presence of water in the home. And the ever-increasing popularity of expensive finishes and components is driving up the cost of repairs when things do go wrong. There is also a growing tendency to conceal pipework, which prolongs the gap between incident and discovery, while thermal
There is intense focus within the insurance industry to develop a response to bring EoW claims under tighter control without diminishing customer experience efficiency requirements in building regulations are creating more spaces into which water can flow unseen. Research by AMA indicates that flexible plastic pipe systems are now the dominant material in hot and cold water installations, but these push-fit fittings are more likely to come loose than traditional copper piping. The rise of timber frame construction and the use of less robust building materials such as chipboard flooring and plasterboard wall finishes, is also making houses more vulnerable.
Modern Insurance 55
FEATURES And the development of multi occupancy blocks in the student, residential and care sectors is also leading to increasingly complex and expensive claims in which more than one property is affected by a single EoW incident.
Reducing claims costs
With homeowners investing more in their homes, expectations of insurers are rising. In response, many now offer cover for undamaged matching items or ‘new for old’ policies, and are trending towards replacement rather than repair. The claims handling process has shifted from customer-driven claims presentation to insurer-driven claims presentation and fulfilment, and from indemnity payment to a solution-based approach. Insurers now take responsibility for everything from mechanical drying and building reinstatement through to contents replacement and providing alternative accommodation. Insurers are also bound to apply the interpretations of the Financial Ombudsman Service (FOS), which at times can be wider than the strict cover afforded by the policy. For instance, the ombudsman typically instructs insurers to award a 50 percent contribution to undamaged matching items in cases where the customer has raised a complaint about aesthetics, even where this is expressly excluded in the policy. This complex claim resolution process can be confusing and challenging for customers. It is critical that insurers appoint the appropriate level of expertise to project manage all aspects of the claim, control costs and deliver an outstanding customer experience. We believe the solution is to specialise and treat EoW claims as a standalone peril. This is why last year we launched a dedicated unit, Crawford EoW, which is so far delivering savings of up to 20 percent. Insurers may not be able to control external factors such as regulation or construction practices, but they can control costs through underwriting and loss adjusting processes, procurement strategy, fraud detection, technology, third-party recovery and managing customer expectations. In the future, technology has a key role to play in reducing costs. Connected homes, for example, could help mitigate risk by including leak detection devices and the remote shut down of water systems (this type of measure may also eventually be required under potential future regulations to reduce water usage and encourage water recycling). The growing popularity of modular construction is also likely to bring claims costs down.
S tats box
EoW claims in the UK in 2016
EoW claims in the UK per day in 2016
Growth in EoW claims between 2014 and 2016
EoW as proportion of high value property claims (>£25K)
UK houses with central heating In the coming months and years, the focus on EoW claims in the property insurance market will only intensify, and the insurers which exert consistent pressure on the aspects of spend which can be controlled are likely to achieve the best results. When it comes to claims, dedicated claims handling solutions led by technical experts are almost certain to deliver the most benefit, while traditional claim fulfilment models may struggle to match the pace of change. Ian Salkeld is the Head of Escape of Water at Crawford & Company.
Increased home-working should also mean more leaks are detected early, reducing claims costs - though underwriting ‘business use’ risks in a domestic setting adds another layer of complexity for insurers. Technology-enabled, self-service claims solutions and apps may even revolutionize the claims process itself. And while big data and actuarial-led decision-making is already enhancing competitive policy cover and pricing, Amazon, Google and other disruptors could pose a threat to the traditional insurance market’s approach.
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Attracting and supporting a new generation Bob Linwood, CEO, discusses the underinvestment of young people in the vehicle repair industry and how why the whole industry needs to engage with each other in order to solve the shortage of skills in the sector.
Why and how did the AutoRaise initiative originate?
The sector has under invested in young people for probably two generations and with an ageing work force, the only solution is to bring young people and train them through the Apprenticeship system
AutoRaise was only ever going to be a group of repairers who created a new vehicle repair Apprenticeship Standard under the government’s new Apprenticeship Trailblazer initiative, where employers created their own fit-for-purpose, modern Apprenticeship Standards for their industries. During 2016, that group evolved to being a fully incorporated charity with one singular aim; to help the vehicle repair industry address its chronic skills shortage. The sector has under invested in young people for probably two generations and with an ageing work force, the only solution is to bring young people and train them through the Apprenticeship system.
How is AutoRaise addressing the concerns about skill shortages and what proactive steps are AutoRaise putting into place?
We primarily exist to serve the employers in our industry; Vehicle Repairers. The majority of business leaders in our sector are hands-on and need help in engaging with young people, their parents and training providers. The new Apprenticeship landscape that the government have created is quite complex. There are different delivery models, different types of apprenticeships (although we are finding that our own Multi-skilled, two-year Apprenticeship is by far the most popular), different funding mechanisms, etc., and we help employers pick their way through this minefield. Critically though, our key aim is to help them find and recruit young people in to their businesses. We do this by putting on Industry Showcase events on their own premises, attending career fairs and working with other organisations that help put young people in to apprenticeships. We have created the www.careers.autoraise.co.uk portal to help young people understand more about our industry and the opportunities within it.
How does the industry need to collaborate in order to ease the impact of the impending skill crisis?
The skills crisis impacts literally everyone in the vehicle repair industry supply chain. Insurers, accident managers and work providers need to ensure their approved repairers are sustainable. With an average technician age of over 45 years old, investing in young people is the only solution if we are to ensure there is capacity for the future. Industry product suppliers, manufacturers, distributors, importers, etc., not only rely on repairers to spend money with them, they will also use this sector to fulfil their own future team structure. Where is tomorrow’s technical demonstrator for paint/abrasives/polishes/etc. going to come from? The whole of the industry needs to engage with the realities of the skills crisis and support AutoRaise so we can continue building strong foundations for a sustainable industry of the future.
In the face of technology advancements, how can the talent of the future be developed and trained to suit the skills this will demand?
This is an interesting aspect to articulate when we are in front of young people and their parents, discussing the industry as a lucrative and rewarding career destination. Young people coming in to our industry now will be better qualified than many existing technicians in the industry as they will have been trained on and be more familiar with the technology that exists in the modern vehicles of today. It’s a perfect scenario; today’s teenagers are far more tech-savvy than older generations and very capable of absorbing and understanding modern technology as it is second nature to them. They are literally learning their trade on modern motor vehicles that are being built today.
What can the industry do as a whole to expose the vehicle repair industry to more candidates and motivate them to consider this as a career path?
They can tell them what a fantastic industry it is, with great earning potential and amazing career prospects. Point them at our www.careers.autoraise.co.uk website and encourage them to get in touch with us. And outside of that, literally everyone in our sector has a part to play in supporting AutoRaise. If you are an insurer or a work provider, you can become an official Partner to AutoRaise and you can encourage all of your own business partners - repairers, suppliers, outsourced contractors and service providers – to make contact with us so they can find out ways of supporting us too. It’s really easy to get in touch with us. Just go to our www.autoraise.co.uk website and fill in one of our enquiry forms and you will have started the engagement process.
Bob Linwood is CEO at AutoRaise.
Modern Insurance 59
The key to FMG’s future FMG launched in 1986 with a workforce of just 15 people and a clear objective to be the best claims management provider in the industry. Today with some 435 people we are leading the way in the provision of high quality, outsourced claims management solutions to an extensive and diverse client base. With the celebration of double-digit growth for the 5th year in a row and a move to newer, larger headquarters, our resolute commitment to exceptional customer service is pivotal to where we are today..
Organic growth through service excellence We operate in partnership with insurers, brokers, MGA’s, leasing intermediaries and direct fleet customers, providing new and innovative ways to remove cost, claims leakage and delay from the claims life cycle. FMG sets itself apart by tailoring efficient and seamless solutions to suit every customer’s specific needs. Significant investment in its people and technology has enabled FMG to streamline every step of the claims management process whilst providing insurers with access to more data than ever before via an award-winning in-house developed proprietary claims management system and portals.
Broad Lea House is a bright, inviting, state of the art head office just minutes away from the M62 road network providing ease of access for UK-wide visitors whilst maintaining our Huddersfield roots.
A place for seamless collaboration Working closely with all our partners is pivotal to our success and Broad Lea House has been designed with collaboration in mind. All teams, including First Notification of Loss, Loss Recovery and Third Party Claims Management operate from this location, sharing one seamlessly integrated operating system. This prevents an external flow of data and allows instant access to incident details, allowing Loss Recovery and Third Party experts to negotiate with insurers within hours of a claim being reported.
A great place to work FMG has invested heavily in creating a great place to work with a bright and engaging office environment. An ‘Investors in People’ employer and a ‘Sunday Times 100 Best Company to Work For’, we have created a dedicated training academy, relax lounge, break-out areas and a café to ensure our people feel engaged, motivated and proud to work for us – after all, happy staff equals happy customers and there lies the key to FMG’s future.
Investing in the future Due to continued growth, the business required a significantly larger headquarters; a clear indication of our size and stature within the outsource claims third party assistance marketplace.
60 Modern Insurance
Case Study Unite Professionals en worked full time as an apprentice butcher, when he had an accident aged seventeen, suffering significant injury to his dominant hand resulting in amputation above the wrist. Unite Professionals were instructed to carry out an INA, undertaken four months post injury.
Ben led an active lifestyle, being involved in Young Farmers, sporting activities, social activities, and attending shows. He was studying butchery qualifications alongside his work. He lived at home with his father and siblings and was previously totally independent with all activities of daily living. Ben’s main rehabilitation goal was: • “To be able to do everything at work and to get things back to normal.” • Case management goals were: • To facilitate ongoing upper limb prosthetic management and requirements for home and work. To consider long term needs such as learning to drive and his apprentice training requirements. Ben was extremely proactive and motivated with his rehabilitation from the start. He demonstrated this immediately by returning to work, within an adapted role, just 26 days post-accident, determined not to let this injury adversely affect his life.
Through case management we fully explored appropriate prosthetic needs, working closely with both the NHS team and Dorset Orthopaedics who provided extensive prosthetic knowledge and expertise. He had trials at home and work looking at both his standard body powered prosthetics alongside highly technical myoelectric prosthesis including the Bebionic arm. There was collaborative working with the local authority regarding food hygiene regulations and his employer regarding practicalities within the workplace. Driving was important for Ben as he lived in a rural location with limited public transport. With support from the local driving assessment centre for advice on adaptations, and driving lessons, Ben passed his test. Funds were available for him to purchase an adapted car used for work and social commitments. Effective and timely communication between all parties enabled Ben to benefit from the provision of myoelectric prosthetics optimising his functional potential at work and home. He progressed his vocational pathway within butchery through the use of his advanced prosthetics and was able to regain independence with all activities. Rachel Bussell, Case Manager, Unite Professionals Ltd.
Jamie France Senior Consultant Underwriting +44 (0) 207 337 8819 email@example.com
Sami Alkarim Senior Consultant Claims +44 (0) 207 337 1205 firstname.lastname@example.org
Valentina Zilinska Senior Consultant Underwriting +44 (0) 207 337 8811 email@example.com
Underwriting, Claims & Broking Vacancies Reinsurance Claims Adjuster
Head of Claims
A top 10 rated Lloyd’s Syndicate are seeking a Reinsurance Claims Adjuster to adjust claims for all Continental European reinsurance lines and to assist other Reinsurance Claims Adjusters and team members as appropriate. They require an individual with Continental European reinsurance claims experience, particularly French motor whilst 3rd party liability is a plus. Please get in touch for further information.
HFG are currently retained on a high-profile search for a leading Managing General Agent to appoint a Head of Claims to direct and oversee the claims department. This will involve day to day management of the claims team across various specialty businesses and you will oversee large losses and audit high exposure claims. You will also manage relationships with underwriting partners, TPAs, and other third party vendors in relation to the management of claims.
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Cyber & Technology Underwriter
Property & Casualty Underwriter
A well-known insurer is looking for a senior individual with a multi-asset allocation and stochastic modelling background to lead its ALM team and be responsible for the business’ ALM process. You will be actively engaged in the development and implementation of the company’s asset allocation strategy for multi-asset portfolios of over $30 billion. A CFA and actuarial background is preferred.
This role involves developing and underwriting profitable business within the property & casualty (P&C) team. The underwriter will work closely with the team leader and underwriting colleagues in a variety of areas, including new business development, underwriting renewal accounts, building broker relationships and responding to P&C queries from other product line underwriters.
£60k- £65k, London
£60k - £65k, London
Business Development Manager A&H
A leading insurer is seeking an experienced M&A Underwriter to generate revenue and profit of the M&A Underwriting business, build strong relationships with brokers and end clients and prepare quotation documents. They require strong knowledge of Warranty & Indemnity (W&I) insurance as well as Tax and Contingent Liability with a focus on delivery in a high pace M&A environment.
A leading global insurer require an A&H / P&C Business Development Manager in their Paris branch. The individual should have a proven track record of business to business in A&H or P&C, experience of partnering with brokers, proven contacts in target markets, experience selling to organisations in France and generating leads and prospect meetings.
£Competitive package, London
€70k - €80k, Paris
www.hfg.co.uk | 0207 337 8800
Modern Insurance Magazine.indd 1
04-Oct-18 12:21:20 PM
10 MINUTES WITH
Harvey Stead Q A
Has the industry changed drastically since you started working in it?
I think FMG has evolved hugely over the last ten years. Providers in our sector were often viewed as a ‘thorn in the side’ of the insurer, but FMG can now demonstrate we can actively add value to the insurers own proposition and improve their operating performance and loss ratios. We now have strategic relationships where we are effectively the outsourced provision for a number of large insurers. Our role is focused on optimising the customer’s claims experience whilst ensuring we mitigate and minimise the cost of the claim for the insurer. We often have to work harder than an in-house provision, as we need to demonstrate value and innovation at every stage of the process. We have tremendous levels of client retention with all our business managed through long term relationships, but you always have the next contract renewal or extension discussion at the back of your mind!
What has been the key positive or negative impact of change in your area of the market?
Vehicle technology has progressed phenomenally in the last five years. We have seen a very gradual reduction in incident frequency over this time, and ADAS in particular has made a significant impact (no pun intended) on low speed incidents. This is now becoming a standard feature on more and more vehicles and we are starting to see ADAS also be fitted to LCV’s. If you’ve ever driven a vehicle where this has cut in, it is extremely effective (and a bit disconcerting the first time it takes over.) However, all this additional technology comes with a cost and the counter to this is the cost of repairing vehicles. All these additional sensors and radar systems has increased the overall repair costs significantly. FMG and our insurer partners must continue to challenge and question repair methodology and cost increases as the ‘it’s all the new technology’ card cannot be used just to warrant repair cost ‘creep’. As a service provider you have to keep pace with this new innovation and also still be able to understand the cost implications and impact that sits behind it.
Who inspires you and why?
I really admire the generation one step behind me - the millennials. These individuals often have a much more ‘fluid’ approach to life, to their career plans and to what they want to achieve. Generally, this age group value happiness and balance as much as financial gain and are much less risk adverse than I was at that age. They are not afraid of failure, and their approach to overcoming the challenges life throws at us is very different to that of my generation. I can see these character traits in all three of my grown up children. The world has changed more in the last
62 Modern Insurance
Our role is focused on optimising the customer’s claims experience whilst ensuring we mitigate and minimise the cost of the claim 100 years than at any time in our history and I can see a generation well prepared to cope with this continued rate of technological development which impacts every area of our lives, how we work, how we interact and how we live.
Have you had/got a mentor? If so, what was the most valuable piece of advice they gave you?
Not a formal mentor relationship as such but I’ve been lucky to work with and for some really inspirational individuals throughout my career. One piece of advice I was given years ago is not to allow yourself to get dragged into the detail. Surround yourself with a strong team who each have a really clear understanding of each individual part of their remit, and if you do have to get involved with something at a granular level, have a very clear path of how to get through that process and back to the ‘bigger picture’. If I can have two - more recently my predecessor at FMG told me never to feel under pressure to make a decision. Take time to reflect and get a better understanding of what the impact of your decisions could be – it is more important that you get the decision right than making it quickly.
If you were not in your current position, what would you be doing?
I joined FMG in 2001 and became Sales Director in 2005. Prior to my recent change of role I was the Commercial Director responsible for our customer relationships and client retention. I have always wanted to lead a business, and to now be lucky enough to do this at FMG, where I have an emotional connection and such a sense of pride and passion about what we do, is my dream job – I really can’t think of anything else I would want to do!
Harvey Stead is the Managing Director of FMG.
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